USD/CAD 1.0133 EUR/CAD 1.4053 USD/JPY 81.78
GBP/USD 1.5858 EUR/USD 1.3849 USD/CHF 0.9597
Commentary:
Risk off - the long awaited correction in the USD as arrived. After four consecutive weekly losses against the Euro, the longest winning streak since early August, the USD moved higher ahead of minutes from the U.S. Federal Reserve's meeting. The USD had been sold off sharply as market players factored in the prospect of more quantitative easing after the Fed's rate-setting meeting on Sep. 21, when the central bank said it stood ready to provide more support for the economy and expressed concern about low inflation. I don't think any insight is to be found in the minutes considering how vocal different FOMC members have been over the last month over the size and effectiveness of any QE. The short covering in the USD pick up speed as losses in global equity markets and commodities added fuel to the USD's bounce. In Asia, the USD dipped against the Yen, however, heading back towards a 15-year low struck on Monday. Japanese Finance Minister Yoshihiko Noda said he had explained to a weekend meeting of the Group of Seven industrial countries in Washington that Tokyo had intervened on September 15 to prevent destabilizing lurches in exchange rates. Elsewhere, Thailand slapped a 15% withholding tax on capital gains and interest income from foreign investment in government debt in a bid to curb the baht, which is at its highest since the 1997 Asian financial crisis. Meanwhile, the AUD was down after China's central bank ordered six lenders to temporarily increase the amount of money they must keep in reserve to rein in lending and combat rising inflation. Reserve requirement ratio for the six lenders was raised by 50 basis points to 17.5% for two months. As you can see from the Asian news that since no currency deal was hatched at last weekend's IMF meeting that different countries are imposing their own restrictions in order to fight currency appreciation. In Canada, the CAD was able to pair earlier loss, by is still off Friday's closing rates, as global stocks and crude oil, the nation’s largest export, rebounded from early losses.
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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