GFX Morning FX Commentary

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.1280-1.1300

Today’s expected range for the Canadian Dollar against the Euro is 1.4100-1.4150

Today’s expected range for the Canadian Dollar against Sterling is 1.7900-1.7950

The US Dollar is mixed this morning as it is stronger against the Pound and Canada but unchanged against the Euro. In the UK, Bank of England Governor Mark Carney lowered both growth and inflation targets for the region citing the “moribund” global economy and stagnation in Europe.  The quote he used was “a specter is now haunting Europe-the specter of economic stagnation”, pretty harsh words from a Central Banker but just highlights just how closely linked the US and the Euro-Zone are. On this news GBP.USD dropped from 1.5940 to trade down at 1.5820, GBP.CAD also dropped as the Loonie was able to pick up some strength against the weak Sterling.

In other UK news the London Stock Market was down some 2.0% as the regulators in the US, UK and Switzerland reached an agreement with several International  banks (Citibank, JP Morgan Chase, HSBC, UBS and Royal Bank of Scotland) to pay a fine of over $3.3 Billion for price fixing in the FX markets. These bank currency traders were speaking to each other during the day on instant messenger systems to report which currencies they needed to buy and sell and then they would manipulate the market to their advantage.

The Canadian Dollar was able to pick up  a little bit of strength against the US Dollar overnight but for the most part it continues to range trade (with a little more volatility) while it waits for the next big breakout. The overall risk is still for a breakout on the higher side for USD.CAD at some point.

CBC was talking this morning about comments from Finance Minister Joe Oliver where he indicated that there will be a Government Surplus next year but with the revenue declining alongside the price of oil it will not come close to the almost $7 Billion that they had earlier predicted. Hard for me to see the Canadian economy growing when our resource sector is going to suffer over the short-term, just another reason I don’t see any sustained Canadian Dollar strength into the first quarter of next year.

With just the US Wholesale trade data out today I would not expect much activity on the trading front, intraday buyers of US should try and grab some at 1.1300 if they can and US Dollar sellers with a bit of time may yet see 1.1400 in the coming days.

Have a great day.

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.1319			1.1387
CAD/USD		0.8778			0.8781
EUR/USD		1.2462			1.2414
EUR/CAD		1.4109			1.4139
STG/CAD		1.7932			1.8062
AUD/CAD		0.9863			0.9826
CAD/JPY		101.8			101.77
CAD/CHF		0.8522			0.85
CAD/HKD		6.8278			6.7877
CAD/CNY		5.4105			5.3766
CAD/MXN		12.033			11.9818
Commodities
Gold		$1,162.00			$1,155.00
OIL		$77.34			$77.17
US DOLLAR INDEX
P.CLOSE		87.52			87.81
OPEN		87.62			87.91
US 10YR YIELD		2.33%			2.36%