GFX Morning FX Commentary September 23rd, 2013

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is 1.0275-1.0340

Today's expected range for the Canadian Dollar against the Euro is 1.3900-1.3970

Today's expected range for the Canadian Dollar against Sterling is 1.6510-1.6580               

The US Dollar is marginally weaker to start the new North American trading week, with more strong data out of Europe helping to push the Euro higher. A Euro-Zone measure of manufacturing came in much better than expected but the big news of course was the election victory by Angela Merkel’s Christian Democrats party that captured almost 42% of the vote but fell 5 seats short of a majority. She will now be forced to find a new coalition partner as her preferred pro-business partner the Free Democratic Party was all but wiped out. The result of this election has to be seen by Euro investors as a confirmation by the German people on the way she has handled the German economy and the Euro debt crisis,  I look for the Euro to continue to trade stronger over the short-term.

The Pound rose for the first time in three days against the US Dollar as optimism continues to grow in the UK. This week the market is expecting a strong UK GDP report as we well as a growing Consumer Confidence report, Sterling should continue to remain strong for the remainder of the week if the numbers are positive.

The Canadian Dollar is unchanged against the US as it is back to levels that we saw just ahead of last week's Federal Reserve announcement, as I said at the time those types of moves are rarely sustainable and this was certainly the case this time as well. I would now expect USD.CAD to settle in around this 1.0300 level ahead any further economic developments

Later this week the big economic news will be the US GDP report for the 2nd quarter, financial markets will want confirmation that the US economy is still gaining momentum. Up today the market is void of economic news but we do get three different Federal Reserve committee members speaking to various groups and if recent activity is any indication then we may see some choppy USD.CAD price action while they are speaking, these guys each seem to have their own agenda when it comes to what the Fed should be doing on the economy and whenever they talk in public they seem to contradict one and other. Right now financial markets are looking for any insight as to when the Fed will turn the taps off on stimulus and they are hanging on every word these guys are saying.

have a great week

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.03			1.0288
CAD/USD		0.9708			0.972
EUR/USD		1.3508			1.3541
EUR/CAD		1.3916			1.3933
STG/CAD		1.6528			1.6491
AUD/CAD		0.9703			0.9698
CAD/JPY		96.24			96.6
CAD/CHF		0.8858			0.8836
CAD/HKD		7.5217			7.5383
CAD/CNY		6.09			5.9497
CAD/MXN		12.4948
Commodities
Gold		$1,322.00			$1,358.00
OIL		$104.90			$108.01
US DOLLAR INDEX
P.CLOSE		80.54			80.48
OPEN		80.51			80.44
US 10YR YIELD		2.75%			2.74%