USD/CAD 1.0486 EUR/CAD 1.3332 USD/JPY 83.76
GBP/USD 1.5372 EUR/USD 1.2695 USD/CHF 1.0099
Commentary:
Risk off - amid a slowing U.S. economy and concerns over European banks the CHF is nearing parity with the USD and the Yen was close to a 15-year high versus the USD. The Euro was unchanged versus the USD after loosing over 2 cents against the USD due to concerns that European banks are vulnerable to losses on some of their European sovereign bond holdings. The yield premium for Irish and Portuguese bonds over German bunds went to a record highs today and the credit-default swaps for these nation’s banks also soared. German Chancellor Angela Merkel's comment on Tuesday that Berlin will not support prolonging rescue mechanisms to underpin the Euro indefinitely because it would damage the single currency only added to the Euro's woes. Also, European Central Bank Governing Council member Axel Weber also chimed in with his comments - he doesn’t expect a recession or a deflationary spiral, policy makers “shouldn’t be tempted to call an end to the crisis.” In the U.K., the GBP was up against the Euro due European bank problems and up versus the USD as home prices in the U.K. tick up for the second straight month in August, although at a slower pace. In Asia, the Yen back off it earlier highs on speculation the Bank of Japan may intervene to curb the currency’s advance. Japan’s Finance Minister Yoshihiko Noda said he is prepared to take “bold” steps on currencies if necessary. Noda told reporters in Tokyo the government is watching markets closely and potential measures to counter the Yen’s appreciation include intervention in markets. Today, the focus will be on the Fed's Beige Book as it releases its survey of conditions in its 12 districts, which will provide insight into the state of the U.S. economy. It comes 2 weeks before its next monetary policy meeting. In Canada, the CAD was confined to a tight range in overnight trading and moved higher after the Bank of Canada raised interest rates for a third consecutive time by a quarter-point to 1%. The BOC did caution that a weak U.S. economy could hamper Canada's recovery.
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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