GFX Morning FX Commentary November 21st, 2012

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is .9935-1.0010

Today’s expected range for the Canadian Dollar against the Euro is 1.2740-1.2800

Today’s expected range for the Canadian Dollar against Sterling is 1.5870-1.5950

The US Dollar is marginally stronger this morning as the Euro traded weaker for most of the overnight session before recovering early this morning. Overnight it was announced that after 11 hours of discussions the EU Finance Ministers could not agree on releasing the next tranche of funds to Greece nor could they agree on giving them more time to pay back what they owe. They have agreed to meet in another week to discuss the situation, not that is what I call quality leadership. There appears to be a real division between the EU and the IMF on what should be done, It will be interesting to see how this gets played out.

Events in the Gaza and Israel continue to escalate rather than slowdown, this morning a bomb blew up on a bus in Tel Aviv injuring 10 people, if this leads to a ground invasion of Gaza I will be very interested to see how it plays out in the new Arab countries, if the come to the aid of the Palestinians this could get very ugly very quickly which would drive the US Dollar higher and equities lower.

The Canadian Dollar is off its highs against the US Dollar as USD.CAD moved a little higher overnight in a very narrow trading range. USD.CAD continues to trade in tight ranges around par but is very susceptible to any weakness in equities or geo-political developments. Up today we do get the release of US Leading Indicators for October and Consumer Sentiment for  November, barring any surprises with these releases we should continue to see USD.CAD trade in a tight range with a bias towards moving higher back towards parity, markets should slow right down this afternoon as the US Bond market closes early ahead of the US Thanksgiving holiday.

Just a reminder that the US wire system is shutdown tomorrow so If you need any US wires sent make sure you get your transactions in early today. To all our American readers may you have a safe and happy holiday.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9965			0.9955
CAD/USD		1.0035			1.0045
EUR/USD		1.2804			1.2814
EUR/CAD		1.2761			1.2757
STG/CAD		1.587			1.5856
AUD/CAD		1.0332			1.0343
CAD/JPY		82.6			81.83
CAD/CHF		0.9432			0.9412
CAD/HKD		7.7559			7.7853
CAD/CNY		6.2491			6.2621
CAD/MXN		13.06
Commodities
Gold		$1,726			$1,733
OIL		$87.50			$89.11
Option Volatility
Canada
O/N		5.96%			7.31%
1 Week		4.85%			5.01%
1 Month		5.56%			5.64%