NBC Daily Forex : October 30, 2013
The National Bank of Canada | Oct 31, 2013 01:55AM ET
Caution is key this morning, as we await Ben Bernanke's statement that will accompany the Fed's key rate decision at 2 p.m. No changes are expected to the QE3 bond purchasing program, and a dovish tone to Bernanke's remarks would probably mean that the status quo will prevail until early next year. Comments hinting at an early end to the quantitative easing program would weigh heavily on stock markets, commodities, bonds and emerging currencies. Given such circumstances, the USD would fare well against other currencies.
Favourable policies by the Bank of Japan and the Fed are supporting carry trades, in which investors can take advantage of the interest rate differential with other currencies. Given the low JPY and USD financing rates, carry trades involve borrowing in these currencies to invest in countries where rates are higher, as is the case for many emerging nations. Such strategies are highly sensitive to changes in the yield curves and support risk-taking.
In economic news, we are awaiting the ADP National Employment Report and inflation data. Yesterday's Retail Sales and CB Consumer Confidence figures came in below analysts' expectations. As we await the Fed's statement, the CAD remains stable against the greenback and Asian and European markets are up slightly. A great deal of volatility is to be expected today. Wishing you a great day! Emmanuel Tessier-Fleury
Range of the day: 1.0410-1.0520
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.