Good Afternoon
The Canadian Dollar has retreated from yesterday's highs against
the US Dollar back to the level that was traded at on Friday. This move was
initiated by weak GDP numbers from the US and a stronger Canadian current
account. These combined to weaken the US Dollar and move away from highs that were reached yesterday.
A weaker US Dollar caused the Euro to strengthen and it looks like it will
remain at this level for some time. The Euro was unable to use its strength
from a weaker US Dollar to help it strengthen against the Canadian Dollar which
continues its trend of slowly strengthening. These pairings look like they will
trade at this high level for the rest of the day as the most significant data
for the day was already released and there is nothing else scheduled for
release that will push it out of the range.
The significant release this morning
was the US GDP numbers which came in weaker than expected at 2.4%. In addition
to GDP numbers the US has released their initial jobless claims which was lower
than expected at 354K. These two releases have weakened the US Dollar against
all currencies and may slow talks of tapering Quantitative Easing.
Tomorrow the Canadian GDP numbers will be
released which could erase today's move if it comes in weaker than expected.
The other big release tomorrow is the EU CPI which could cause some volatility
in the Euro when it is released.
Yonah
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