VBCE Daily Foreign Exchange Update for Wednesday, Sept. 21, 2016

USDCAD spot rate: 1.3192 - 1.3297 (as at 8:32am PST)

Ranges:

Asia:

1.3174

to

1.3197

Europe:

1.3150

to

1.3172

North America:

1.3172

to

1.3219

Technical Support / Resistance:

S2

S1

R1

R2

1.3089

1.3122

1.3248

1.3300

Key Economic Data Releases:

- Canada Wholesale sales (Jul) 0.3% (0.2% exp.) 0.7% previous

- US crude oil inventories 6.20M (3.35M exp.) -0.559M previous

- Fed interest rate decision, economic projections 11am, followed by Fed Yellen speech

Key Event Calendar:

Date

Canada

U.S.A.

Sept. 22

Sept. 23

CPI, retail sales

Existing home sales

Manufacturing PMI

The USD is lower overall as trading has essentially entered a holding pattern with attention turning to the Fed's latest monetary policy decision which is set to be released at 11am, followed by a speech by Janet Yellen at 11:30am. With market-implied odds of an interest rate rise hovering around 20%, tightening today would come as a major surprise to investors, even as some argue that the time is right to hike. With the presidential election looming, a decision to delay raising rates potentially comes with political baggage. Even if there is no hike, the statement's description of the economy, a fresh set of quarterly economic projections and Yellen's press conference could shed light on what the Fed may do next. Meanwhile, the BoJ left their policy rate unchanged at -10bpts while keeping the option to cutting it further. BoJ introduced "QQE with Yield Curve Control", a new policy framework that will seek to control both short-term & long-term interest rates. The framework is complemented by an inflation-overshooting commitment. Currently, the TSX is up 0.87% and the Dow is up 0.32%. EURCAD is down 0.02% trading between 1.4648 and 1.4735. GBPCAD is down 0.04% trading between 1.7071 and 1.7154. JPYCAD is up 1.15% trading between 0.01284 and 0.01311. Gold is up 0.84% trading between $1,307 and $1,330USD/oz., silver is up 2.54% trading between $19.04 and $19.75USD/oz., while oil is up 1.46% trading between $44.05 and $45.45

Sources: Reuters, Bloomberg, FXStreet, RBC Capital Markets, Bank of Canada, U.S. Federal Reserve, CNBC, Forexlive, CME Group

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The information and opinions contained herein are gathered from sources which are thought to be reliable but the reader should not assume that the information and opinions are official or final. VBCE makes no warranty concerning the accuracy of the information and opinions, and accepts no liability for the consequences of any actions taken on the basis of the information and opinions provided. The content is for general information only and does not constitute in anyway giving financial advice.