GFX Morning FX Commentary, August 27th, 2013

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.0480-1.0560

Today’s expected range for the Canadian Dollar against the Euro is 1.4022-1.4100

Today’s expected range for the Canadian Dollar against Sterling is 1.5310-1.5400

The US Dollar is marginally stronger against the Euro and Sterling this morning and unchanged against the Canadian Dollar. In Europe the German IFO (a measure of economic performance) report came in and showed a little better than expected. Economic reports out of Germany have been improving lately so this may give a boost to Chancellor Merkel’s campaign for re-election, I have yet to see any polls in the media but if her party were to lose the election September 22^nd then I think you will see the Euro get smashed.

The Euro continues to benefit from the meltdown in emerging markets as the Indian Rupee and the Indonesian Rupiah continue to get hit the hardest of all emerging markets. Also getting hit are the Brazilian Real and the Mexican Peso with both trading weaker over the past few weeks. As I mention earlier none of this flow of money is coming to Canada for investment purposes, most of it seems to be supporting the Euro at the moment.

With the threat of military intervention in Syria escalating, stocks have started to give up some gains in Europe and Asia. I have said it many times before, financial markets do not like uncertainty and with Syria there are lots of questions to be answered, first and foremost is what will Russia and Iran do if the West intervenes in Syria? Look for stocks to stay unsettled if the risk of military intervention increases.

Up today we get the release of US Consumer Confidence report for August, the last few economic out of the uS releases have been poor, if this data is weak you could see the US Dollar get hit again. I still favour a move higher for USD.CAD but for the moment but we should be contained to tight intraday ranges.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0528			1.0518
CAD/USD		0.9498			0.9507
EUR/USD		1.3345			1.3368
EUR/CAD		1.4054			1.4063
STG/CAD		1.6338			1.6377
AUD/CAD		0.9424			0.9484
CAD/JPY		92.82			93.73
CAD/CHF		0.8746			0.8778
CAD/HKD		7.3455			7.3512
CAD/CNY		5.8115			5.8159
CAD/MXN		12.6839			12.4156
Commodities
Gold		$1,412.00			$1,395.00
OIL		$106.90			$106.44
US DOLLAR INDEX
P.CLOSE		81.42			81.41
OPEN		81.5			81.47
US 10YR YIELD		2.80%			2.82%