First, I’d like to thank the Committee for this honor…What? Obama? Oh, never mind…
We’ve got a two-tiered market this morning where commodity currencies are leading the pack with the market concluding that Canada is the next Australia. I think that conclusion is a bit premature as Australia is tied to the hip of fast growing China while Canada is tied to the slow-growing US. Sure, Canada ships commodities to China, but not nearly to the extent that Australia does.
Canada also has a central bank that has been quite vocal on the dangers of a strong Loonie. Lower for longer may be the result.
CAD trades at levels not seen in over a year, at 1.0440 while EUR/USD is in familiar territory in the 1.4750s. I’m still amazed that EUR/USD has not been able to re-challenge recent highs near 1.4840 despite the big moves in gold and commodity currencies.
