GFX Morning FX Commentary

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is 1.1100-1.1180

Today's expected range for the Canadian Dollar against the Euro is 1.5180-1.5260

Today's expected range for the Canadian Dollar against Sterling 1.8430-1.8500

The US Dollar is stronger this morning led higher by a weaker British Pound. In the UK the government reported 4th quarter growth numbers slightly below expectation, it was still a favorable report but the fact that growth was a little less than some economists were predicting caused Sterling to drop, the short-term trend for Sterling will be to remain strong.

Currency markets continue to focus on the sell-off of emerging market currencies, the Argentina Government is limiting the purchase of US Dollars a month by individuals, India increased interest rates overnight and in Turkey the central bank is under fierce pressure to hike interest rates to stem the decline of the Lira, global investors are all running for the exit sign as they try and redeem investments in these countries.

With a stronger US Dollar overnight the Loonie is weaker this morning, this once again highlights my point that any signs of Canadian Dollar strength be short-lived and US Dollar buyers cannot afford to wait, they must be ready at all times with orders close to the market.

Up today we do get some Canadian Trade data but for the most part the currency market will get ready for two key US announcements, first is the State of the Nation address by the President tonight. Canadians will be looking for any notes on the Keystone pipeline, If he does announce that he favours it then I do believe the Loonie will get a bit of a boost. The 2^nd key announcement will be the Federal Reserve announcement tomorrow where most market economists are still expecting the Fed to announce further reduction in their stimulus program, a move which should push the stocks lower and the US Dollar higher,

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.1114			1.1054
CAD/USD		0.8998			0.9046
EUR/USD		1.3641			1.3668
EUR/CAD		1.5163			1.5118
STG/CAD		1.8397			1.8324
AUD/CAD		0.9781			0.9667
CAD/JPY		92.78			92.93
CAD/CHF		0.8041			0.81
CAD/HKD		6.9639			7.0021
CAD/CNY		5.438			5.4681
CAD/MXN		11.9504			12.1155
Commodities
Gold		$1,255.00			$1,263.00
OIL		$96.19			$96.74
US DOLLAR INDEX
P.CLOSE		80.49			80.5
OPEN		80.7			80.5
US 10YR YIELD		2.78%			2.75%