GFX Morning FX Commentary October 1st, 2012

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is .9800-.9875

Today’s expected range for the Canadian Dollar against the Euro is 1.2650-1.2750

Today’s expected range for the Canadian Dollar against Sterling is 1.5840-1.5940

The US Dollar is marginally lower this morning as holiday’s in the Far East have closed equity markets throughout the region and have left currency trading subdued. The Euro is a little bit higher from Friday’s close as it reacted to the Spanish Bank stress tests showing that the Spanish Banks will not need any more funds than the previously allotted 60 Billion Euro, the markets are still waiting to see if the Spanish Government will request the full bail-out from the EU later this month as a large swath of Spanish debt is due for redemption and they won’t have the money to pay back the bonds, the ECB announces on interest rates later this week so currency traders will be watching to see if Governor Draghi address the Spanish situation. The Euro probably would have traded higher throughout the morning session but EU manufacturing data showed a decline and on top of poor Chinese manufacturing data put a lid on its strength.

USD.CAD is basically where we left it on Friday, the Loonie initially made some small gains but nothing material and traded in a narrow range for most of the evening. This will be a busy week for the Loonie as we get US and Canadian employment reports this week, minutes from the last Federal reserve meeting and lots of manufacturing data, these types of releases will be closely scrutinized as we head closer to the US general election.

For today the North American markets are showing a strong opening so I would expect USD.CAD to move back lower towards the .9800 level but once again we should have muted ranges.

Have a great day

Mike

GFX Morning Currency Rates
Monday October 01, 2012
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9828			0.9803
CAD/USD		1.017			1.02
EUR/USD		1.2893			1.2933
EUR/CAD		1.2672			1.268
STG/CAD		1.5865			1.5883
AUD/CAD		1.0165			1.0204
CAD/JPY		79.28			79.16
CAD/CHF		0.9553			0.9533
CAD/HKD		7.8664			7.8859
CAD/CNY		6.3927			6.4075
CAD/MXN		13.081			13.1034
Commodities
Gold		$1,771			$1,782
OIL		$91.93			$91.99
Option Volatility
Canada
O/N		11.03%			7.58%
1 Week		7.90%			7.70%
1 Month		7.25%			6.90%