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%

 

 

 

GFX Morning Commentary

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.0950-1.1020

Today’s expected range for the Canadian Dollar against the Euro is 1.4140-1.4220

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

The US Dollar is  marginally weaker this morning as the currency markets prepare for the results of the Scottish referendum and react to the US Federal Reserve comments from yesterday. In their statement the Fed left the words “considerable time” in place which most market watchers now think means the Fed won’t increase interest rates until at least June, there is still lots of slack in the US economy and lots of jobs yet to be created before the Fed changes policy.

The polls are now open in Scotland but according to news reports we are not expecting final results until around Midnight/1:00 am Toronto time, keep in mind a yes vote will bring increased volatility to the currency markets affecting all currency pairs including USD.CAD. If you want to take away some of the uncertainty of the market make sure that you get your orders in early.

The Canadian dollar had a busy night trading in a  wide range with the Loonie giving up some of its gains from yesterday, as I mentioned yesterday I was not surprised that the Loonie could not hold onto the strength it had from the Poloz comments, that type of movement rarely holds in place for long. The Loonie continues to hold in against the Euro and Sterling as it continues to benefit from weakness in those currencies.

In addition to the Vote we get some secondary US data but overall we should have a relatively stable day but I would expect a very busy night, on a yes vote there is no reason not to think that we could see USD.CAD above 1.1100 tomorrow.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.098			1.0965
CAD/USD		0.9107			0.912
EUR/USD		1.2877			1.2955
EUR/CAD		1.414			1.4206
STG/CAD		1.793			1.7878
AUD/CAD		0.9847			0.994
CAD/JPY		98.95			97.85
CAD/CHF		85.4			0.8517
CAD/HKD		7.0395			7.0484
CAD/CNY		5.5912			5.5968
CAD/MXN		12.0592			12.0269
Commodities
Gold		$1,224.00			$1,238.00
OIL		$94.38			$94.77
US DOLLAR INDEX
P.CLOSE		84.6			84.07
OPEN		84.55			84.07
US 10YR YIELD		2.61%			2.57%

 

 

 

 

 

 

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is 1.0950-1.1020

Today's expected range for the Canadian Dollar against the Euro is 1.4210-1.4280

Today's expected range for the Canadian Dollar against Sterling is 1.7900-1.7970

The US Dollar is marginally weaker this morning as Sterling is a little higher on the release of the Bank of England policy minutes that showed for the 2nd consecutive month two members of the committee voted to increase interest rates. With tomorrow's independence vote too close to call Sterling trading is dominating the currency markets with Euro trading really taking a back seat.

Ahead of the Scottish vote, trading today will be dominated by the US Federal Reserve interest rate announcement. There will be no change to interest rates but if the announcement further emphasis a rate hike early in 2015 then the US Dollar will get a boost.

The Canadian Dollar is much stronger this morning following comments yesterday by Bank of Canada Governor Poloz, while taking questions from reporters he indicated that he will not intervene in markets to control the value of the Dollar and clearly stated that the Bank is more concerned with inflation than the value of the Loonie. “A floating Loon is a thing of beauty, and so is a floating Loonie” was his quote for the day, these statements caught a lot of people (including me) by surprise and the Loonie was able to extend its gains back below 1.1000. I have tended to find over the years that currency movements resulting from official comments are very short lived so if I was a US Dollar buyer I would be looking at these levels as a big win.

As mentioned above trading today will be dominated by the Fed announcement this afternoon, ahead of that we get US CPI data for August were we are expecting a year-over-year inflation rate of  1.9% down from last month’s 2.0%. and with the Scottish vote tomorrow I think we will see some enhanced volatility over the next few days, make sure you get your orders in early today to take advantage of any moves.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0965			1.1056
CAD/USD		0.912			0.9022
EUR/USD		1.2955			1.2941
EUR/CAD		1.4206			1.431
STG/CAD		1.7878			1.7907
AUD/CAD		0.994			0.9971
CAD/JPY		97.85			96.88
CAD/CHF		0.8517			0.8464
CAD/HKD		7.0484			6.9894
CAD/CNY		5.5968			5.5577
CAD/MXN		12.0269			11.9734
Commodities
Gold		$1,238.00			$1,234.00
OIL		$94.77			$92.67
US DOLLAR INDEX
P.CLOSE		84.07			84.25
OPEN		84.07			84.24
US 10YR YIELD		2.57%			2.56%

 

 

 

 

GFX Morning FX Commentary

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.1020-1.1080

Today’s expected range for the Canadian Dollar against the Euro is 1.4280-1.4350

Today’s expected range for the Canadian Dollar against Sterling is 1.7860-1.7920

The US Dollar is marginally stronger this morning as it was again led by a dip in the British Pound. This morning Sterling was led lower by the inflation report that showed inflation hit its lowest level in 5 years, if this trend continues over the short-term it may influence the Bank of England timing on interest rate hikes, if inflation is dropping towards deflation rates the last thing the BOE will do is increase interest rates. Sterling is also weaker on nervousness of Thursday’s Scottish independence vote, with the No side slightly ahead in the last poll it really will be a wild card. My own feeling is the No side will prevail which if I am correct will push GBP.USD and GBP.CAD higher, Sterling buyers may want to consider putting on some forwards at current levels at this time.

The Canadian Dollar had a very quiet night after it sustained a good rally yesterday, it had a sniff near the 1.1100 level first thing yesterday morning and then slowly retreated for the rest of the afternoon, I think we will be approaching levels once again where US Dollar buyers need to be ready to purchase some forwards. I still favour a break of the 1.1100 at some point and if GBP.CAD goes much higher after the Thursday vote it may pull USD.CAD higher as well.

Up today we have some secondary data out of the US and Canada so I am not expecting much action around the release. Bank of Canada Governor Poloz is speaking at 1:45 on Floating Exchange Rates, I am not sure if he is taking questions after the speech, if he does we may get the possibility that he drops a comment that would get the markets moving.

Have a great day

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.1056			1.1084
CAD/USD		0.9022			0.9022
EUR/USD		1.2941			1.2921
EUR/CAD		1.431			1.4322
STG/CAD		1.7907			1.8006
AUD/CAD		0.9971			1.0003
CAD/JPY		96.88			96.76
CAD/CHF		0.8464			0.8445
CAD/HKD		6.9894			6.9728
CAD/CNY		5.5577			5.5421
CAD/MXN		11.9734			11.9517
Commodities
Gold		$1,234.00			$1,235.00
OIL		$92.67			$91.51
US DOLLAR INDEX
P.CLOSE		84.25			84.23
OPEN		84.24			84.48
US 10YR YIELD		2.56%			2.60%

 

 

 

GFX Morning FX Commentary

Good Morning

Today's expected range for the Canadian Dollar against the US Dollar is 1.1060-1.1130

Today's expected range for the Canadian Dollar against the Euro is 1.4300-1.4360

Today's expected range for the Canadian Dollar against Sterling is 1.8000-1.8060

The US Dollar is marginally stronger this morning as the prospects of US interest rate hikes early in 2015 continue to push the Greenback higher, the big movers overnight where the Aussie Dollar and the Swedish Krona. In Australia the Dollar fell below the .9000 cent level for the first time since March, weak data out of China pushed the Aussie lower and in Sweden yesterday's National election produced a minority parliament with the anti-immigration Social Democrat party picking up increased support.

The Canadian Dollar is at its weakest level since the first quarter as USD.CAD gets set to test the 1.1100 level, the Loonie also lost some strength against the Euro and Sterling as both of those currencies were quiet overnight.

Up today we have data out of the US including capacity Utilization, Empire Manufacturing and  Industrial Production so we should have a busy morning . Later in the week we get lots of inflation data out of Canada and the US  and the Scottish independence vote on Wednesday. In addition the highlight of the week will be Thursday when the Federal Reserve announces on interest rates, markets will be looking for further confirmation of interest rate hike sin 2015. I would expect volatility to hold in and we should see a test of 1.1100 at some point this week if not today.

Have a great week

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.1084			1.1046
CAD/USD					0.9053
EUR/USD		1.2921			1.2927
EUR/CAD		1.4322			1.4277
STG/CAD		1.8006			1.7954
AUD/CAD		1.0003			1.0000
CAD/JPY		96.76			96.9900
CAD/CHF		0.8445			0.8462
CAD/HKD		6.9728			6.9935
CAD/CNY		5.5421			5.5521
CAD/MXN		11.9517			11.9927
Commodities
Gold		$1,235.00			$1,238.00
OIL		$91.51			$93.14
US DOLLAR INDEX
P.CLOSE		84.23			84.31
OPEN		84.48			84.31
US 10YR YIELD		2.60%			2.61%