​VBCE Daily Foreign Exchange Update for Tuesday, Jan. 10, 2017

USDCAD spot rate: 1.3205 - 1.3210 (as at 8:08am PST)

Ranges:

Asia:

1.3198

to

1.3238

Europe:

1.3208

to

1.3254

North America:

1.3193

to

1.3257

Technical Support / Resistance:

S2

S1

R1

R2

1.3150

1.3190

1.3260

1.3305

Key Economic Data Releases:

- CAD Building Permits -.01% (-5.0% exp.) 10.5% previous

- CAD Housing Starts 207k (195k exp.) 187k previous

Key Event Calendar:

Date

Canada

U.S.A.

Jan. 11

Jan. 12

Jan. 13

New housing price index

Producer price index, retail sales

Risky assets hit the skids on Tuesday, with stocks and sterling tumbling over political uncertainty over Britain's future ties with the European Union and the policies of the incoming U.S. president, Donald Trump. European stock markets opened broadly lower, with the exception of Britain's blue-chip FTSE stock index, which hit a fresh record high on the back of sterling's fall to multi-week lows – seen as beneficial to exporters. The British currency hit a 10-week low against the dollar and an eight-week low against the euro after weekend comments by British Prime Minister Theresa May that she was not interested in Britain keeping "bits" of its EU membership. A revival in worries that Britain could be headed for a "hard Brexit," in which it chooses to take full control of immigration and give up access to the single market, reverberated across financial markets, lifting demand for safe-haven assets such as German government bonds and gold, which rose to its highest level in over a month. EYES ON TRUMP A near 4-per cent slide in oil prices on Monday also tempered risk appetite, while caution was also setting in ahead of a news conference on Wednesday by Trump, his first since winning the election. The market has high expectations for Trump's economic policy; perhaps they are booking profits just in case he throws in a curve-ball at tomorrow's much anticipated press conference. For FX markets, what will be particularly important will be what his plans are for the trade policy, for the relationship with China. Currently, the TSX is up 0.37% and the DOW is down 0.09%. EURCAD is up 0.05% trading between 1.3967 and 1.4035. GBPCAD is down 0.13% trading between 1.6007 and 1.6110. JPYCAD is up 0.17% trading between 0.01139 and 0.01145. Gold is up 0.35% trading between $1,180 and $1,190USD/oz., silver is up 0.53% trading between $16.53 and $16.82USD/oz., while oil is down 0.25% trading between $51.58 and $52.34.

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.