GFX Morning FX Commentary Nov 15th, 2012

Good Morning,

Today’s expected range for the Canadian Dollar against the Us Dollar is .9970-1.0050

Today’s expected range for the Canadian Dollar against the Euro is 1.2730-1.2800

Today’s expected range for the Canadian Dollar against Sterling is 1.5830-1.5900

The US Dollar is mixed this morning as it is much stronger against the Japanese yen and marginally weaker against the Euro. In Japan the Yen reached a 6 month low as opinion polls are showing that the opposition party is favoured to form the Government next month and they are perceived to be more pro-economic stimulus than the last Government. In Europe the Euro is a bit stronger despite reports that the show the EU economy has fallen into a recession(defined as two consecutive quarters of negative growth) which is a bit surprising.

Sterling is also weaker as it fell to a two week low against the Greenback on weaker than expected UK retail sales. The UK economy continues to produce poor numbers which should keep Sterling under pressure for the short-term.

The Canadian recovered it’s losses from yesterday afternoon in the overnight session, as the equity markets were smashed yesterday the Loonie gave up its strength and USD.CAD traded higher, as the US Dollar weakened off last night the Loonie was able to recover and still trades near parity this morning.  

Up today we do get some economic data out of the US, including CPI and the Empire and Philadelphia Fed manufacturing reports, I think these manufacturing reports will be more closely watched than the inflation report as inflation has been relatively benign over the last few months. For today it looks like equities will open on the positive side recovering some of the losses from yesterday, if the stock market can hold these gains then look for USD.CAD to break towards the .9970 level, if as we have seen lately that stocks quickly turn negative during the day then USD.CAD will move higher towards 1.0050.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.001			1.0006
CAD/USD		0.999			0.9994
EUR/USD		1.2764			1.2732
EUR/CAD		1.2782			1.2742
STG/CAD		1.5864			1.5877
AUD/CAD		1.0327			1.0428
CAD/JPY		81.15			80.01
CAD/CHF		0.9417			0.9442
CAD/HKD		7.7212			7.7447
CAD/CNY		6.2237			6.2237
CAD/MXN		13.2424
Commodities
Gold		$1,723			$1,721
OIL		$86.39			$85.51
Option Volatility
Canada
O/N		7.79%			8.62%
1 Week		5.93%			6.27%
1 Month		6.18%			6.31%