GFX Morning FX Commentary, March 8th, 2012

Good Morning,

Todays suggested range for the Canadian dollar against the US Dollar is .9900 – 1.0025

Todays suggested range for the Canadian dollar against the Euro is 1.3160-1.3300

Todays suggested range for the Canadian dollar against Sterling is 1.5700-1.5825

The US Dollar is weaker this morning as expectation that the Greek private debt swap which expires today at 4:00 pm Eastern time will reach a critical number of participants, presently over 60% of private Greek debt holders have agreed to the swap and the rest should fall in place today, I believe 75% voluntary participation is the level  needed so the Greek Government can force the rest through. EURO.USD which had been trading with a weak bias reached a high of 1.3245 and looks like it wants to continue to move higher pushing the US Dollar lower.

This morning as expected both the ECB and BOE have kept interest rates at current levels and in the case of the Bank of England they did not announce any new stimulus programs for the UK economy. Markets will now be waiting on ECB President Draghi's press conference at 08:30  to see if he is announcing any new stimulus programs and to see if his overall view on the Euro-Zone economy has changed.

The Canadian Dollar is stronger this morning as it has benefited from the weaker US Dollar overnight, unable to break above par yesterday USD.CAD will now look to test the .9950 level ahead of this morning's Bank of Canada announcement and tomorrow's employment report.

We are not expecting any changes to the bank's interest rate policy but we awaiting their comments on the economy and to see if they still view early 2013 as the timeframe for the next interest rate hike, any negative comments on the economy should push USD.CAD higher (back towards parity) and if the comments are upbeat then the initial reaction should be for USD.CAD to fall towards .9925. North American equity markets are pointing a lot higher this morning so that will help give the Loonie some strength, there are also rumours floating around that if the Chinese inflation rate shows it is moderating that will give the Chinese Central Bank room to cut interest rates to help stimulate growth, such a move would be Canadian Dollar positive.

Tomorrow morning we will be commenting on the  Canadian employment report where we are looking at the creation of 14.5K new jobs and no change to the employment rate. As always if the number comes in different from expectation we could see enhanced volatility so make sure your orders are in ahead of us going home tonight.

As always we will send out a quick currency alert after the Bank of Canada.

Have a great day

Mike

GFX FOREIGN EXCHANGE MORNING UPDATE

Thursday, March-08-12

Market Indicators                   * For current market prices please contact our currency advisors or visit our
                                                  on line site at www.gfxpartners.ca *

Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9954			1.0008
CAD/USD		1.0046			0.9092
EUR/USD		1.324			1.3131
EUR/CAD		1.3184			1.3144
STG/CAD		1.573			1.5739
AUD/CAD		1.0609			1.0578
CAD/JPY		81.96			80.62
CAD/CHF		0.914			0.9166
CAD/HKD		7.7577			7.7544
CAD/CNY		6.3414			6.3016
Commodities
Gold		$1,702			$1,681
OIL		$106.97			$105.31
Option Volatility
Canada
O/N		12.87%			12.99%
1 Week		9.93%			10.08%
1 Month		9.14%			9.42%