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NBC Daily Forex : May 23, 2013

ByThe National Bank of Canada
Published 05/24/2013, 08:27 AM
Updated 05/14/2017, 06:45 AM
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Today promises to be difficult, with our screens already filled with red this morning: a correction due to recently released negative HSBC China Manufacturing PMI figures. The Nikkei is down 7.3%, the sharpest drop in nearly 2 years. European markets are down more than 2% and the futures market points to a negative opening in North America. After impressive gains at the beginning of the year, such a correction seemed inevitable.

In his speech to the U.S. Congress, Fed Chairman Ben Bernanke stated that prematurely tightening U.S. monetary policy could slow the economic recovery, but that sustained job gains would eventually push the Fed to reduce its bond buying program. This statement, along with the release of the minutes of the most recent FOMC meeting and lower-than-expected Canadian Retail Sales data, weighed on the Canadian dollar–which had a very difficult day yesterday. Despite the market correction, the loonie is gaining some ground this morning.

This is good news for exporters who can now expect to sell USD at very attractive rates. The loonie is at its lowest level since June 2012 and we recommend businesses call their trader to take advantage of the situation.

In economic news, U.S. Initial Jobless Claims and New Home Sales figures are expected today. Wishing you a great day. Emmanuel Tessier-Fleury

Range of the day: 1.0290 - 1.0395

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