GFX Morning FX Commentary

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is 1.1040-1.1125

Today's expected range for the Canadian Dollar against the Euro is 1.5200-1.5270

Today's expected range for the Canadian Dollar against Sterling is 1.8470-1.8540

Thanks for all the well wishes on my return for vacation, Mrs. Smith had a great time so all is good.

The US Dollar is marginally weaker in quiet overnight trading markets, the British Pound is slightly stronger for the 2nd day in a row as the mortgage approval rates reached their highest levels in years and also on comments by a Bank of England official that the high value of Sterling has not had a dramatic effect on exporters.

An interesting development while I was away has been the weakness in the Chinese Yuan. The Chinese Government as you know artificially keeps its currency within a 1% band to help keep the price of their exports low, this is a big bone of contention for the US Government. Over the past few months the Yuan had been appreciating in the band but this past week the USD.CNY rate has risen from 6.0650 and is now trading at 6.12 making the Chinese rate the weakest it has been in 3 years, there are rumours that the Chinese Government may be widening the band to 2% to allow the currency to stay weak. It may be worthwhile for clients sending US Dollars to China to look at sending Yuan instead, we have the ability to help with this so let us know if you are interested.

The Canadian Dollar had a very quiet night as it slowly recovers from the bad economic data last week. Readers may recall that before I went on vacation I was urging US buyers to purchase some US Dollars on forward contracts when USD.CAD was below 1.1000, it was this very scenario that I was trying to protect against. Going forward bouts of Canadian Dollar strength will be slow and limited at best while Canadian Dollar weakness will be fast and dramatic, US Dollar buyers need to protect themselves against these types of moves.

Up today we do get US Consumer Confidence data at 10:00 am and I will be looking to see if the bad weather that we have been experiencing will still be having a negative effect on the US recovery.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.1066			1.1104
CAD/USD		0.9037			0.9005
EUR/USD		1.3744			1.3736
EUR/CAD		1.5212			1.5256
STG/CAD		1.8461			1.848
AUD/CAD		1			0.998
CAD/JPY		92.95			92.78
CAD/CHF		0.8014			0.7998
CAD/HKD		6.9918			9.9645
CAD/CNY		5.5315			5.4903
CAD/MXN		11.9697			11.9531
Commodities
Gold		$1,334.00			$1,332.00
OIL		$101.95			$102.08
US DOLLAR INDEX
P.CLOSE		80.22			80.27
OPEN		80.09			80.22
US 10YR YIELD		2.74%			2.73%