GFX Mornign Commentary Sept 16th, 2013

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is 1.0270-1.0350

Today's expected range for the Canadian Dollar against the Euro is 1.0370-1.3820

Today's expected range for the Canadian Dollar against Sterling is 1.6400-1.6470

The US Dollar is marginally weaker this morning as news that the Obama favored candidate Lawrence Summers has removed his name for consideration as the next US Federal Reserve Chairman when Bernanke retires at the end of the year. Most Democrats seem to favour Janice Yellen to get the Presidential appointment as she is perceived to be one who will keep the stimulus taps flowing. The dollar is also losing some steam as the likelihood of an American attack on Syria diminishes, higher yielding currencies (countries with higher interest rates) have benefited from this with the Aussie Dollar and New Zealand Dollar getting much stronger. GBP.USD continues its march higher, once again the pound reached new highs with the currency pair jumping to 1.6420 on the back of the weaker US Dollar.

With the weaker US Dollar the Loonie has been able to extend its recent strength as it looks to break below the 1.0300 level today but once again I think any Canadian Dollar strength will be very gradual and the USD.CAD currency pair will always be subject to a rapid rise if any negative news hits the market, I still favour US Dollar buyers taking advantage of these levels by putting on some forward buys-

Up today we get some secondary US data so we are not expecting any dramatic moves, we should see USD.CAD test the 1.0300 level at some point to see if the US Dollar is well supported at that level. Later in the week we get the Canadian Retail Sales report for August and CPI report on Friday. Most important will be the US Federal Reserve meeting on Wednesday were a consensus seems to be growing that the Fed will start to turn off the stimulus taps, more on this later in the week.

Have a great week.

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0297			1.0329
CAD/USD		0.9711			0.9681
EUR/USD		1.3347			1.3284
EUR/CAD		1.3745			1.3724
STG/CAD		1.6402			1.6331
AUD/CAD		0.9654			0.9556
CAD/JPY		96.01			96.47
CAD/CHF		0.9001			0.9018
CAD/HKD		7.5249			7.5017
CAD/CNY		5.94			5.923
CAD/MXN		12.5629			12.7044
Commodities
Gold		$1,315.00			$1,315.00
OIL		$106.85			$107.55
US DOLLAR INDEX
P.CLOSE		81.68			81.69
OPEN		81.33			81.77
US 10YR YIELD		2.81%			2.91%