Today's
expected range for the Canadian Dollar against the US Dollar is .9860-.9950
Today's
expected range for the Canadian Dollar against the Euro is 1.2410-1.2500
Today's
expected range for the Canadian Dollar against Sterling is 1.5680-1.5750
The
US Dollar is marginally weaker this morning as the Euro continued to inch
higher on the investor expectation that the ECB will be granted extraordinary
measures to enter the market and purchase sovereign bonds. Also this morning
Spanish Prime Minister Rajoy and French President Hollande are having their own
crisis meeting as the expectation grows that Spain will be forced to ask the EU
for a bail out. Another two regional Governments in Spain have applied to
Madrid for a bail out so the crisis continues to ramble along with no end in
sight which is too bad as these governments are totally consumed by the debt
crisis and have no plans to grow their economies, there won't be any change
anytime soon to the 25% unemployment rate in Spain.
With
yesterday's US GDP report coming in exactly as expected (US economy grew at
1.7% for the quarter) the focus of the markets will now turn to Bernanke's
speech at Jackson Hole scheduled for tomorrow, I am not sure 1.7% is good
enough and it looks like he will be hinting at further stimulus in September.
Nothing
new to report on the Loonie, USD.CAD jumped a little higher last night but
still remains in very tight ranges, right now it looks like it wants to
continue to trade around the .9900 level for a while.
Up
today we have some minor economic data out of the US and Canada but not enough to
influence the currency markets, equity futures are pointing lower to start the day
so look for USD.CAD to test a bit higher at some point but once again I am not
expecting any kind of dramatic movement until we see what Bernanke says
tomorrow.
Long-time
readers will know that I am not a big fan of the Bank Act here in Canada which
allows Canadian Banks to operate unfettered from foreign competition in the
Canadian market, I believe that this approach costs Canadian business like
yours and mine millions of dollars in higher fees and borrowing costs. The last
two days have seen record profits once again from the big five (RBC made 2.2
billion just for the last QUARTER) with the Canadian retail operations of the
banks leading the way. This morning there was a CBC report that said the
international Banking regulator based in Switzerland which was formed after the
banking crisis of 2008 has now called for Ottawa to limit the size of the
Canadian banks as they are now considered "too big to fail" and
called for more foreign competition in the Canadian Banking system. The report
shows the combined balance sheets of the big 5 are at least 2.5 times the size
of the total Canadian GDP, can you imagine what a bank failure in Canada would
do to the overall economy, It would be a disaster. I find it quite humorous
that a banking system that was held up as an example to the rest of the world
in 2008 is now deemed too big to fail. I will leave it to your imagine to
figure out what Ottawa's reaction will be, I think it may have involved the
middle finger on Finance Minister Flaherty’s right hand but that is yet to be
confirmed.
Have
a great day
Mike
GFX
Morning Currency Rates
|
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Thursday August 30,
2012
|
|||||||
| Currencies | 7:00am Today's Opening | Yesterday's Opening | |||||
| USD/CAD | 0.9913 | 0.9887 | |||||
| CAD/USD | 1.0087 | 1.0114 | |||||
| EUR/USD | 1.254 | 1.2555 | |||||
| EUR/CAD | 1.2432 | 1.2415 | |||||
| STG/CAD | 1.5697 | 1.5643 | |||||
| AUD/CAD | 1.0242 | 1.0246 | |||||
| CAD/JPY | 79.27 | 78.54 | |||||
| CAD/CHF | 0.9653 | 0.9667 | |||||
| CAD/HKD | 7.8016 | 7.8218 | |||||
| CAD/CNY | 6.4017 | 6.4222 | |||||
| CAD/MXN | 13.4767 | 13.3904 | |||||
| Commodities | |||||||
| Gold | $1,658 | $1,668 | |||||
| OIL | $95.33 | $95.61 | |||||
| Option Volatility | |||||||
| Canada | |||||||
| O/N | 7.53% | 6.90% | |||||
| 1 Week | 6.18% | 5.60% | |||||
| 1 Month | 6.43% | 6.50% | |||||
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