GFX Morning FX Commentary, April 18th, 2012

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is .9875-.9975

Today's expected range for the Canadian Dollar against the Euro is 1.2940-1.3050

Today's expected range for the Canadian Dollar against Sterling is 1.5810-1.5925   

The US Dollar is marginally stronger in very narrow trading ranges this morning, currency traders seem to be taking a step back to await the next developments out of Europe and the USA.

The biggest piece of news from the overnight session was the release of the Bank of England minutes from their last meeting on interest rates and for the first time in quite a while the board was unanimous on not adding more stimulus to the UK economy, the pound was able to extend some gains against the Greenback on the report, GBP.USD reached a high of 1.5990. The Pound was also helped higher by better than expected employment data out of the UK so overall a very good night for merry old England.

As reported yesterday the Loonie had a big surge on the back of the Bank of Canada interest rate announcement as Governor Carney indicated that economic conditions should allow for interest rates hikes sooner than previously expected, USD.CAD prior to the announcement looked like it wanted to head above par but quickly fell to test the .9900 level. Overnight the Loonie has been able to hold those gains but it has not been able to extend then as USD.CAD traded in a very tight range.

If you are a US Dollar buyer I think you really need to take advantage of this type of move and lock in some of your requirements going out a few months, every time in the last 6 months the Loonie had shown any signs of strength something has happened around the world to stem the strength of the Loonie and push USD.CAD higher, make sure that you take advantage of this move and buy some forwards at these levels.

Up today we have the release of the Bank of Canada Monetary Policy Report where the Bank will go into some depth on the condition of the Canadian economy. Barring any surprises from the report and with Equity markets pointing lower to start the day we should see USD.CAD move higher but overall trading ranges should be muted.

Have a great day

Mike

GFX Morning Currency Rates
Wednesday, April 18 2012
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.99			0.9968
CAD/USD		1.01			1.0032
EUR/USD		1.3077			1.3131
EUR/CAD		1.2944			1.3092
STG/CAD		1.5824			1.5905
AUD/CAD		1.0268			1.0337
CAD/JPY		82.26			80.86
CAD/CHF		0.9283			0.9174
CAD/HKD		7.8403			7.7835
CAD/CNY		6.3633			6.3185
CAD/MXN		13.263			13.1945
Commodities
Gold		$1,647			$1,655
OIL		$104.17			$103.60
Option Volatility
Canada
O/N		11.52%			11.54%
1 Week		8.68%			8.87%
1 Month		8.53%			8.60%

Today's Economic Calendar

USA
None

Canada
BoC Monetary Policy Report (10:30)