If At First You Don't Succeed, Try Try Again - What ever amount of QE is announced today by the Fed, keep in mind that QE 1.0 was $1.7 trillion and it apparently wasn't big enough to do the job because here we are again. Most currencies traded in a tight range as investors were unwilling to make new bets ahead of the U.S. central bank's policy decision due at around 2:15 EST. The market as priced in a $500 billion QE program over five months, but traders are eager for details of the scope and pace of bond purchases. The big mover of the day was the GBP, as it hit a nine-month high on stronger-than-expected UK services sector activity data added to the argument that the Bank of England may not implement more QE for at least two more months. Tomorrow we have central bank meetings from the European Central Bank, the Bank of England and the Bank of Japan. Also, U.S. and Canadian monthly jobs data are due on Friday. Meanwhile, last night U.S. midterm election results was already discounted by the market as the Republicans took control of the House of Representatives while the Democrats were set to hang on to the Senate. This morning's news that U.S. private sector payrolls increased by 43,000 new jobs in October helped to spur the USD slightly higher against the Euro and Yen. The October tally marks a strong improvement from the upwardly revised September count, which showed that a net 2,000 positions were eliminated. The October total also marks the best reading since May. In Canada, the CAD was slightly firmer, hitting a two week high, as crude oil, Canada’s largest export, rose to a six-month high. The CAD may get a boost should Canada’s Industry Minister Tony Clement allow the foreign takeover of Potash Corp. of Saskatchewan Inc. by Anglo-Australian miner BHP Billiton. If the $39 billion hostile bid goes through, the CAD could go higher as many Canadian shareholders convert their USD payouts back to the domestic currency.
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