GFX Morning FX Commentary

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.2360-1.2420

Today’s expected range for the Canadian Dollar against the Euro is 1.4140-1.4210

Today’s expected range for the Canadian Dollar against Sterling is 1.9020-1.9090

The US Dollar is weaker as North American currency markets play catchup after the holiday weekend. The Euro was higher against the Greenback and it shrugged off a breakdown in talks between Greece and the EU, to date no agreement has been reached to extend the loans made to Greece beyond the Feb 28^th day when those loans are set to expire. The Euro did find some support as the German ZEW business survey came in a little bit better than expected but overall Euro should trade weaker as the Greek deadline looms. In the UK the Pound rallied a little bit as the inflation report fell 0.9% slightly more than expected, this number will force BOE Governor Carney to write an open letter to the UK Finance Minister explaining why the inflation rate is a full point below the BOE target of 2.0%.

The price of Oil continues to creep higher and still remains above the $50 market, I heard a report this morning that US shale oil producer are taking about 100 wells offline each month as the price remains subdued. If this trend continues it may bring the supply and demand equation back into line and ease off the pressure on the oil price.

The Canadian Dollar has been able to make some gains over the last 24 hours and as it once again tests below the 1.2400 level, we are starting to see USD.CAD break below levels that we have not seen in over a month, I would want to see us continue to stay at these levels for at least a few day’s to confirm this is a significant pullback for the Loonie, every time we have hit these levels the USD.CAD rate has jumped higher.

This week’s economic activity will be highlighted by the US Federal Reserve’s interest rate announcement tomorrow, market watchers will be looking to see if the FED is keeping their plan in place to increase interest rates in the summer or with the weak US economic data they are changing their tune and pushing off until the Autumn or even early next year. In addition to the Fed we get a slew of US secondary data and also Canadian Wholesale Trade and Retail Sales, it will be another busy and volatile week.

Have a great week

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening			4pm Friday close
USD/CAD		1.2366			1.2515			1.2462
CAD/USD		0.8087			0.799			0.8024
EUR/USD		1.1435			1.1415			1.1398
EUR/CAD		1.4144			1.4291			1.4206
STG/CAD		1.9042			1.9259			1.9196
AUD/CAD		0.967			0.9693			0.9677
CAD/JPY		95.95			94.95			95.25
CAD/CHF		0.7515			0.7417			0.748
CAD/HKD		6.2482			6.1714			6.1999
CAD/CNY		5.0564			4.9844			5.006
CAD/MXN		12.0046			11.9452			11.9452
Commodities
Gold		$1,223			$1,223			$1,228
OIL		$53.28			$51.88			$52.54
US DOLLAR INDEX
OPEN		93.94			94.14			94.13
US 10YR YIELD		2.05%			2.00%			2.02%