Good Afternoon
The US Dollar strengthened against the Canadian Dollar
in anticipation of tomorrow's release of the FOMC minutes. These
will indicate how the committee feels
about quantitative easing with speculation that quantitative easing
will be reduced. A reduction in quantitative easing will strengthen
the US Dollar which had strengthened in anticipation of a reduction in easing.
The US Dollar could not maintain this level as the Dollar weakened and returned
to the range that started the day.
The EUR.USD has shot out of the range it was trading in and
reached highs because of weakness in the US Dollar.
The
Yen has stopped weakening against the dollar after its largest gain in three
weeks. This comes after comments from the Japanese Economic Minister that more
weakness from the Yen could "hurt peoples lives". It appears that the
Bank of Japan wants the value of the Yen to remain at its current levels and
prevent weakening to 110. These comments indicate the Bank of Japan is trying
to control the devaluation of the Yen and initiate controlled inflation.
Tomorrow
will see the release of some reports that are significant enough to affect
the currency markets. Canada will release the retail sales numbers while
the United States will release home sales, and the minutes from the FOMC
meeting. These reports should affect the markets and we should see some volatility
tomorrow.
Yonah
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