GFX Morning Commentary

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is 1.0870-1.0925

Today's expected range for the Canadian Dollar against the Euro is 1.4930-1.4990

Today's expected range for the Canadian Dollar against Sterling is 1.8270-1.8330   

The US Dollar is stronger this morning gaining the most against the British Pound. ‎Sterling dropped the most of any major currency this morning as the Bank of England officials indicated that they will wait until next year before pushing through any interest rate increases, also out of the UK the inflation report was very low which will put the BOE under pressure to keep interest rates low. Deflation is becoming a much bigger problem than most economists are commenting on and will have to be dealt with by central bank policy. The Euro continues to trade weaker as investor expectation that the European Central Bank will create a stimulus plan next month continue to mount.

Nothing new to report on the Canadian Dollar it continues to trade in very tight ranges, USD.CAD did test a bit higher last night but the Loonie quickly recovered early this morning and we are back at yesterday's closing levels to start the day. With the weakness in the Euro and Sterling the Loonie is doing very well against European currencies, I think it is a good time to look at doing some forward contracts at these levels if you know you will need some Euro or Sterling down the road.

Up today we get some secondary US inflation data (Producer Price Index) so currency traders may be paying attention a little more closely than they normally would to this release, any signs of a slowing inflation rate in the US may bring some volatility to the currency market. If the number comes in as expected look for USD.CAD to continue to trade within a narrow band.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0904			1.0905
CAD/USD		0.917			1.3711
EUR/USD		1.3709			1.6829
EUR/CAD		1.4952			0.9344
STG/CAD		1.8289			0.8632
AUD/CAD		1.0234			1.0207
CAD/JPY		93.38			93.77
CAD/CHF		0.8157			0.816
CAD/HKD		7.1041			7.103
CAD/CNY		5.7081			5.7093
CAD/MXN		11.8755			11.8849
Commodities
Gold		$1,301.00			$1,292.00
OIL		$101.96			$101.28
US DOLLAR INDEX
P.CLOSE		80.13			79.85
OPEN		80.05			80.07
US 10YR YIELD		2.58%			2.64%