GFX Morning Commentary

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.0925-1.1000

Today’s expected range for the Canadian Dollar against the Euro is 1.4090-1.4160

Today’s expected range for the Canadian Dollar against Sterling is 1.7930-1.8000

The US Dollar is mixed this morning as it reacts to the Scottish “No” vote for independence from Britain. When the early results started to come in and it was apparent that the No side would win Sterling started a very rapid rise against the US Dollar with GBP.USD rising form our Toronto close of 1.6390 to trade up at 1.6520, as the final results came in this morning the strength in Sterling kind of petered out and GBP.USD fell back to where we closed it. I get a sense that currency traders quickly put the vote issue behind them and once again as markets are prone to do started to focus on UK fundamentals and they have not been that strong of late. For the global economy I think this is a great result as you have heard me say before that financial markets do not like uncertainty and a Yes vote would have created lots of  that.

The Canadian Dollar had a relatively quiet night, the Loonie gave back a little bit of its gains from yesterday afternoon, If there had been a Yes vote in Scotland I think we could have easily been at 1.1200 so once it was evident that the vote was going No the rest of the currency markets were fairly quiet.

We could have a busy morning as we get the Canadian CPI data for August, we are expecting a rise an inflation rate of 0.1% for the month but the overall year-over-year headline number should drop a little to 1.9%, if it drops further than this we may get some volatility, it certainly seems deflation is more of a worry around the world than inflation.

I will be out of  the office for the next two days as my son gets married tomorrow, I will be checking emails for the morning on my BlackBerry but if you need anything just drop a line to traders@gfxpartners.ca

Have a great weekend

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0958			1.098
CAD/USD		0.9126			0.9107
EUR/USD		1.2864			1.2877
EUR/CAD		1.4097			1.414
STG/CAD		1.7954			1.793
AUD/CAD		0.9828			0.9847
CAD/JPY		99.28			98.95
CAD/CHF		0.8557			85.4
CAD/HKD		7.051			7.0395
CAD/CNY		5.6005			5.5912
CAD/MXN		12.0625			12.0592
Commodities
Gold		$1,221.00			$1,224.00
OIL		$92.97			$94.38
US DOLLAR INDEX
P.CLOSE		84.3			84.6
OPEN		84.53			84.55
US 10YR YIELD		2.63%			2.61%