GFX Morning Commentary June 19th, 2013

Good Morning,

The expected range for the Canadian Dollar against the US Dollar is 1.0180-1.0280

The expected range for the Canadian Dollar against the Euro is 1.3650-1.3750

The expected range for the Canadian Dollar against Sterling is 1.5950-1.6050

The US Dollar is marginally weaker this morning in what was a very quiet overnight trading session. The market is setting up for the only event that will matter today and that is the US Federal Reserve announcement on interest rates and Bernanke’s follow on press conference. We are not expecting any changes to interest rates but will be closely watching for any signs of the beginning of the end for the Fed’s stimulus program, any signs of a reduction in their bond purchase program will get all markets very volatile. There are also rumours that Bernanke could hint at retirement, I am sure he will be asked the question so the market will be very interested to see if he his leaving before his term is up.

The Bank of England released the minutes of their latest interest rate policy meeting and the vote was 6-3 to keep their Quantative easing in place, it certainly looks that Carney is walking into a very undecided committee and it may be very difficult for him to make a difference, he should be in for a very interesting time in the UK. Carney’s replacement Stephen Poloz gives his first public speech in Oakville today, I am not expecting any surprises from him as the subject matter will quite mundane but he will be taking questions from the media so it will be interesting to see how he handles his first press conference.

The Canadian Dollar also had a quiet night, nothing new on the range front as we still trade in the 1.0150 to 1.0250 trading range, we should remain quiet ahead of the Fed announcement at 02:00. If they Fed announces or hints at a tapering of the QE then I think we will see USD.CAD move to 1.2050 very quickly, if the Fed stays the course then I think we will slowly move back to 1.0150. I will send out a currency alert shortly after the announcement.

Have a great day.

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0208			1.0204
CAD/USD		0.9796			0.98
EUR/USD		1.339			1.338
EUR/CAD		1.3669			1.3656
STG/CAD		1.5951			1.5949
AUD/CAD		0.9702			0.965
CAD/JPY		93.16			93.42
CAD/CHF		0.9018			0.901
CAD/HKD		7.577			7.5812
CAD/CNY		6.0012			6.0026
CAD/MXN		12.6223			12.6285
Commodities
Gold		$1,367.00			$1,377.00
OIL		$98.82			$97.54
US DOLLAR INDEX
P.CLOSE		80.81			80.81
OPEN		80.79			80.88