USD/CAD 1.0266 EUR/CAD 1.3454 USD/JPY 85.76
GBP/USD 1.5662 EUR/USD 1.3086 USD/CHF 1.0088
Commentary:
After moving to a 5-week high, the Euro lost all of its gains versus the USD on renewed market speculation that an Irish bank was facing troubles servicing its debt. The leader of Ireland’s Green Party, John Gormley, said today that the country’s bond spreads would widen should Ireland consider renegotiating with bondholders of Anglo Irish Bank Corp. This of course sent yields on Irish 10-year bonds to a record relative to those of benchmark German bunds. Meanwhile, in the UK the GBP reached its strongest level against the USD in more than a month as rising stocks showed that the risk trade was still on. Also lending support to the GBP are new government spending cuts scheduled to be announced on October 20th, by Chancellor of the Exchequer George Osborne designed to curb the nation’s budget deficit. In Asia, the USD remained near a one month high against the Yen as the threat of further Japanese intervention kept the Yen on edge. The threat that U.S. may embark on another round of QE as early has next Tuesday could undo the affects of this week's Yen intervention, so look for traders to test the resolve of Japanese authorities. Japanese markets are closed on Monday and Thursday next week for public holidays. In the U.S., the cost of living in the U.S. climbed in August for a second month as energy and food prices increased, while other goods and services showed little change. The August CPI showed that overall consumer prices increased 0.3% month-over-month and core prices went unchanged month-over-month. Talk of more BE by the U.S., England, and Japan and the recent Yen intervention, which is leaving its intervention proceeds unsterilized, has put a firm bid under the price of Gold. In Canada, the CAD pared earlier gains against the USD on renewed concerns of European sovereign debt due to condition of European banks. With no domestic economic news out today look for the CAD to take its cue from the performance of the stock market.
Disclaimer: Please note that any currency rates/prices contained in this document are indicative, and subject to change without notice. Prices quoted may vary substantially based upon the size of transaction and market volatility.
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