Friday November 30th, 2012

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is .9880-.9960

Today’s expected range for the Canadian Dollar against the Euro is 1.2860-1.2940

Today’s expected range for the Canadian Dollar against  Sterling  is 1.5880-1.5950

The US Dollar is marginally weaker this morning against the Euro as the currency markets traded in very narrow ranges and were for the most part dominated by Yen trading, EURO.JPY rose to a 6th month high.  Japan the 3^rd largest economy in the world is facing some tough challenges, it has basically lost a decade due to low growth and now in the midst of an upcoming election the debate rages on whether the Bank of Japan and the new government should provide much more stimulus. The US Dollar was also influenced by comments yesterday afternoon from Speak Boehner that they were not getting any closer to a deal with the President, look for the rhetoric to continue.

In Europe The EU unemployment report showed that unemployment rose to 11.7% up from 11.6% as 18.7 million workers are unemployed, Spanish unemployment is expected to go to 27% shortly. How can an EU with employment tax revenue falling, social costs rising expect to fund a debt crisis in the coming months, this situation will hit the tipping point at some point.

The Canadian Dollar is right where we left it last night, I don’t know if it really traded at all last night. Each of the Canadian banks would have a treasury staff at one of their foreign branches managing the banks FX positions, I  am not sure how any of these traders would be able to justify their salaries in these current environments, if this was to continue I would expect large layoffs at some of the Canadian banks. After all RBC only made a $1.9B for the 4^th quarter so they would not want any pesky trader cost’s eating into that profit.

Up today I am hopeful that we will see some volatility around the release of the Canadian GDP for the month of September and the end of the third quarter, year over year we are expecting a growth rate of 1.2% which is certainly lagging behind the numbers reported yesterday by the US at 2.7%. Both numbers are not very exciting but at 1.2% there is really no growth in the Canadian economy and certainly no meaningful job creation will occur. If the number disappoints then look for USD.CAD to move up towards .9950 very quickly.

Have a great weekend

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9925			0.9914
CAD/USD		1.0075			1.0086
EUR/USD		1.3011			1.2986
EUR/CAD		1.2915			1.2878
STG/CAD		1.2929			1.5882
AUD/CAD		1.0349			1.0371
CAD/JPY		83.26			82.76
CAD/CHF		0.9324			0.9344
CAD/HKD		7.7874			7.7937
CAD/CNY		6.2705			6.28
CAD/MXN		13.0132			13.059
Commodities
Gold		$1,732			$1,726
OIL		$88.21			$88.00
Option Volatility
Canada
O/N		5.00%			7.14%
1 Week		5.20%			5.27%
1 Month		5.10%			5.14%

 

 

GFX Morning FX commentary November 29th, 2012

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is .9870-.9950

Today's expected range for the Canadian Dollar against the Euro is 1.2830-1.2900

Today's expected range for the Canadian Dollar against Sterling is 1.5840-1.5920

My apologies for the lack of commentary yesterday, the email service was down all day and I was unable to send it out. If this ever happens and you want to read the commentary, you can always access it at our blog www.gfxpartners.blogspot.com , I also post the commentary there as well as emailing it out.

The US Dollar is marginally weaker this morning as equity markets rallied on comments from Republican house speaker John Boehner that there is a strong likelihood that they will reach a deal on spending cuts and tax increases with the President sooner than later. Once again the rhetoric on the Fiscal Cliff continues and financial markets are hanging on every comment, I cannot put any faith in these comments as something negative could be said by any US lawmaker that would just turn the markets around, this rhetoric will go on for a few weeks yet and will add volatility to global markets

Euro strength was also helped by better than expected Spanish and Italian bond auctions which were well received by investors, with Greece moving to the sidelines we may start to see the Euro crisis fade from the front pages. The picture is still very gloomy as German unemployment rose again last month, with German national elections due next year Angela Merkel should not make any long-term plans to be in government and then what happens is anybody’s guess.

With the weakness in the US Dollar overnight the Loonie was able to pullback some strength but USD.CAD still trades in the .9900 to .9950 trading range, with US GDP due out today we may see that change. We are expecting an increase in US growth of 2.8%, if the number is better than expected then equities will jump and USD.CAD will fall below .9900, if it is below expectation just the opposite will happen and USD.CAD will jump above the .9950 level.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9914			0.9948
CAD/USD		1.0086			1.0052
EUR/USD		1.2986			1.2901
EUR/CAD		1.2878			1.2836
STG/CAD		1.5882			1.5912
AUD/CAD		1.0371			1.0389
CAD/JPY		82.76			82.28
CAD/CHF		0.9344			0.937
CAD/HKD		7.7937			7.7689
CAD/CNY		6.28			6.252
CAD/MXN		13.059			13.1446
Commodities
Gold		$88			$87
OIL		$1,726.00			$1,738.00
Option Volatility
Canada
O/N		7.14%			7.24%
1 Week		5.27%			5.07%
1 Month		5.14%			5.03%

 

 

GFX Morning FX Commentary Nov 28th, 2012

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is .9910-.9975

Today’s expected range for the Canadian Dollar against the Euro is 1.2790-1.2860

Today’s expected range for the Canadian Dollar against Sterling is 1.5850-1.5930

The US Dollar is stronger this morning as talk of a deadlock in “Fiscal Cliff” discussions have hurt equity markets and pushed the US Dollar higher. Overnight EURO.USD fell to trade at 1.2890 as the wind was taken out of recent Euro strength. Look for a lot more of this rhetoric over the next few weeks affecting the market, I mean who would have thought that Democrats and Republicans could not get along when talking about the economy, I am shocked that this thing has not been settled yet, perhaps they should all jump off the cliff and that would solve the problem. The Euro also traded lower on fears that the Greek debt agreement will not go over as planned and a bigger than expected drop in German Consumer prices, lots for investors to worry about in Europe.

The Canadian Dollar is just slightly weaker than where we left it last night and is firmly stuck in the .9910-.9975 trading range, last night the currency moved less than 15 pips so the Loonie is pretty much on ignore from global currency traders.

With no major economic releases until tomorrow (US Q3 GDP) I am not expecting much of a move today, over the next few days I would still be cautious that USD.CAD can move higher on any negative news hitting markets but for now USD.CAD should remain range bound with very uninspiring trading conditions.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9948			0.9921
CAD/USD		1.0052			1.0079
EUR/USD		1.2901			1.2979
EUR/CAD		1.2836			1.2847
STG/CAD		1.5912			1.5897
AUD/CAD		1.0389			1.0395
CAD/JPY		82.28			82.67
CAD/CHF		0.937			0.9369
CAD/HKD		7.7689			7.7902
CAD/CNY		6.252			6.2687
CAD/MXN		13.1446			13.102
Commodities
Gold		$87			$88
OIL		$1,738.00			$1,747.00
Option Volatility
Canada
O/N		7.24%			6.94%
1 Week		5.07%			4.84%
1 Month		5.03%			5.06%

GFX Morning FX Commentary November 27th, 2012

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is .9880-.9950

Today's expected range for the Canadian Dollar against the Euro is 1.2800-1.2875

Today's expected range for the Canadian Dollar against Sterling is 1.5860-1.5940

Apologies for the late Commentary, GO transit was not at its finest this morning.

The US Dollar is marginally stronger this morning on reports that a Greek deal has been reached but it is a deal that appears to just delay the inevitable and has disappointed investors. The EU has cut the Greek interest rates and given them more time to pay back the debt but they did not forgive any of the massive debt, something that investors were looking for. The EU once again shows their lack of leadership in tackling a problem and just kicks the can down the road, Greece should now fall from the front pages and the focus will once again move back to Spain.

The Canadian Dollar is stronger this morning as USD.CAD looks set to test the .9900 level, there are reports coming out of China that a strong Chinese Yuan will be good for commodity currencies, so I think this small move for the Loonie is a bit of a catch up for it. Yesterday saw the announcement that Bank of Canada Governor will resign next year to take over the Bank of England, this is a great loss to Canada as Carney was one of the most respected Central Bank Governors in the world, in terms of policy and the currency markets this won’t have much short-term effect on the Loonie but long–term it should be Sterling positive.

Up today we do get some secondary US releases so if the numbers continue to be positive for the United States we could see USD.CAD break .9900 as equities will be on the rise. I would still be concerned about a violent pullback towards parity for USD.CAD so these are good levels for US Dollar buyers to pick up some forward contracts.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9921			0.9929
CAD/USD		1.0079			1.0071
EUR/USD		1.2979			1.2968
EUR/CAD		1.2847			1.2881
STG/CAD		1.5897			1.5914
AUD/CAD		1.0395			1.0375
CAD/JPY		82.67			82.64
CAD/CHF		0.9369			0.9348
CAD/HKD		7.7902			7.7824
CAD/CNY		6.2687			6.2668
CAD/MXN		13.102			13.0683
Commodities
Gold		$88			$1,749
OIL		$1,747.00			$87.94
Option Volatility
Canada
O/N		6.94%			7.17%
1 Week		4.84%			5.18%
1 Month		5.06%			5.09%

GFx Morning FX Commentary November 26th, 2012

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is .9900-.9975

Today's expected range for the Canadian Dollar against the Euro is 1.2860-1.2930

Today's expected range for the Canadian Dollar against Sterling is 1.5860-1.5940

The US Dollar is marginally stronger this morning as EURO.USD is weaker on nervousness on the EU Finance Ministers meeting on Greek aid and the gains the separatists made in Catalonian (the region that includes Barcelona) in weekend elections. It is expected that the will continue the flow of funds to Greece but with the EU nothing is certain so investors are a little nervous.

The Canadian dollar is marginally weaker this morning but it is still holding onto strength above par as currency traders continue to ignore the Loonie. The early reports from Black Friday seem to indicate that Americans opened their wallets so equity markets should like that when the final numbers come in, up today we get “Cyber Monday” which will be closely watched to see how online shopping is doing.

Equities are pointing lower to start the new week and with no economic reports due out today I am not looking for much of a range, USD.CAD should pull back higher a little testing the .9950 level but for the most part it should be a quiet day.

 

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9929			0.9968
CAD/USD		1.0071			1.0032
EUR/USD		1.2968			1.2901
EUR/CAD		1.2881			1.2861
STG/CAD		1.5914			1.5892
AUD/CAD		1.0375			1.04
CAD/JPY		82.64			82.5
CAD/CHF		0.9348			0.9366
CAD/HKD		7.7824			7.7536
CAD/CNY		6.2668			6.2468
CAD/MXN		13.0683			13.0758
Commodities
Gold		$1,749			$1,734
OIL		$87.94			$87.18
Option Volatility
Canada
O/N		7.17%			5.09%
1 Week		5.18%			4.96%
1 Month		5.09%			5.50%