Forex Market News - Canada dollar rides liquidity plan to higher close
Wed Dec 12, 2007 4:56pm EST
By Frank Pingue
TORONTO, Dec 12 (Reuters) - The Canadian dollar rose versus
the U.S. currency on Wednesday despite a turnaround in equity
markets that ate away at early gains made after a coordinated
move by major central banks to help resolve liquidity issues.
Canadian bond prices ended lower across the curve due to a
combination of the central bank actions and Canadian trade data
that came in ahead of expectations.
The Canadian dollar closed at 98.70 U.S. cents, valuing a
U.S. dollar at C$1.0132, up from Tuesday's session close of
98.58 U.S. cents, or C$1.0144.
A sharp turnaround in North American equity markets, which
stumbled after posting big gains early in the session, took its
toll on the Canadian dollar and yanked it from a session high
of 99.45 U.S. cents, or C$1.0055.
Support for the Canadian currency came early in the session
as major central banks, including the Bank of Canada, came
together to ease the tight conditions in the money market.
"The short-term implications of the establishment of the
liquidity facility were positive for the commodity currencies
... including the Canadian dollar," said David Powell, currency
analyst at IDEAglobal in New York.
"But equities have taken a U-turn and ... that has seen the
Canadian dollar and the rest of the commodity currencies give
back those gains."
Both the Toronto Stock Exchange and Dow Jones industrial
average rallied more than 200 points during the session before
closing with gains of 85.67 points and 41.13 points
For its part, the Bank of Canada said it would expand its
list of securities eligible as collateral to provide liquidity
to the markets and will include U.S. Treasuries, probably by
the middle of 2008.
Liquidity traditionally dries up a bit at yearend but the
recent credit crunch has exacerbated the problem.
Powell also said the Canadian dollar has been battling a
market than has turned much less bullish on the currency since
the Bank of Canada cut its key interest rate last week for the
first time since April 2004.
A 5 percent jump in oil prices also helped to support the
Canadian dollar since Canada is a major producer and exporter
BONDS END LOWER
Canadian bond prices handed back gains recorded during the
previous session as a stronger-than-expected Canadian trade
surplus and the central bank action reduced the safe-haven
appeal of government debt.
Canada's trade surplus rose to C$3.32 billion in October
from C$2.81 billion in September, although the value of both
imports and exports fell. Analysts had, on average, predicted
October's surplus would be C$2.45 billion.
The move by major central banks, under the leadership of
the U.S. Federal Reserve, to help ease the tight conditions in
the money market followed Tuesday's Fed decision to cut its key
rate by 25 basis points to 4.25 percent.
Many market players had called for a 50 basis point cut
from the Fed.
The two-year bond fell 29 Canadian cents to C$100.88 to
yield 3.777 percent. The 10-year bond slid 71 Canadian cents to
C$99.83 to yield 4.022 percent.
The yield spread between the two-year and 10-year bond
moved to 24.5 basis points from 30.3 at the previous close.
The 30-year bond declined 97 Canadian cents to C$114.54 to
yield 4.141 percent. In the United States, the 30-year Treasury
yielded 4.544 percent.
The three-month when-issued T-bill yielded 3.89 percent, up
from 3.86 percent at the previous close.
(Reporting by Frank Pingue; Editing by Peter Galloway
Reuters journalists are subject to the Reuters Editorial Handbook which requires fair presentation and disclosure of relevant interests.
Forex Trading News
Daily Forex Market News Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Forex News Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."
Elevate Your Trading With The Amazing Trader!
The Amazing Trader includes:
Actionable trading levels delivered to YOUR charts in real-time.
looking for your first broker or do you need of a new one? There are
more critical things to consider than you might have thought.
We were trading long before there were online brokers. Global-View
has been directly involved with the industry since its infancy. We've
seen everything and are up-to-data with recent regulatory changes.
The Global-View Forex Forum is the hub for currency trading on the web. Founded in 1996, it was the original forex forum and is still the place where forex traders around the globe come 24/7 looking for currency trading ideas, breaking forex news, fx trading rumors, fx flows and more. This is where you can find a full suite of forex trading tools, including a complete fx database, forex chart points, live currency rates, and live fx charts. In addition, there is a forex brokers directory where you can compare forex brokers. There is also a forex brokers hotline where you can ask for help choosing a forex broker that meets your individual fx trading needs. Interact on the same venue to discuss forex trading.
The forex forum is where traders come to discuss the forex market. It is one of the few places where forex traders of all levels of experience, from novice to professionals, interact on the same venue to discuss forex trading. There is also the GVI Forex, which is a private subscription service where professional and experienced currency traders meet in a private forex forum. it is like a virtual forex trading room. This is open to forex traders of all levels of experience to view but only experienced currency tradingprofessionals can post.
Currency trading charts are updated daily using the forex trading ranges posted in the Global-View forex database. You will also find technical indicators on the fx trading charts, e.g. moving averages for currencies such as the EURUSD. This is another forex trading tool provided by Global-View.com.
The forex database can be used to access high, low, close daily forex ranges for key currency pairs, such as the EURUSD, USDJPY, USDCHF, GBPUSD, USDCAD, AUD, NZD and major crosses, including EURJPY, EURGBP, EURCHF, GBPJPY, GBPCHF and CHFJPY. Data for these currency trading pairs dating back to January 1, 1999 can be downloaded to an Excel spreadsheet.
Forex chart points are in a currency trading table that includes; latest fx tradinghigh-low-close range, Bollinger Bands, Fibonacci retracement levels, daily forex pivot points support and resistance levels, average daily forex range, MACD for the different currency trading pairs. You can look on the forex forum for updates when one of the fx trading tools is updated.
Global-View also offers a full fx trading chart gallery that includes fx pairs, such as the EURUSD, commodities, stocks and bonds. In a fx trading world where markets are integrated, the chart gallery is a valuable trading tool. Look for updates on the Forex Forum when the chart gallery is updated.
Global-View.com also offers a forex blog, where articles of interest for currency trading are posted throughout the day. The forex blog articles come from outside sources, including forex brokers research as well as from the professionals at Global-View.com. This forex blog includes the Daily Forex View, Market Chatter and technical forex blog updates. In additional to its real time forex forum, there are also Member Forums available for more in depth forex trading discussions.
WARNING: FOREIGN EXCHANGE TRADING AND INVESTMENT IN DERIVATIVES
CAN BE VERY SPECULATIVE AND MAY RESULT IN LOSSES AS WELL AS PROFITS. FOREIGN
EXCHANGE AND DERIVATIVES TRADING IS NOT SUITABLE FOR MANY MEMBERS OF THE
PUBLIC AND ONLY RISK CAPITAL SHOULD BE APPLIED. THE WEBSITE DOES NOT TAKE
INTO ACCOUNT SPECIAL INVESTMENT GOALS, THE FINANCIAL SITUATION OR SPECIFIC
REQUIREMENTS OF INDIVIDUAL USERS. YOU SHOULD CAREFULLY CONSIDER YOUR FINANCIAL
SITUATION AND CONSULT YOUR FINANCIAL ADVISORS AS TO THE SUITABILITY TO YOUR
SITUATION PRIOR TO MAKING ANY INVESTMENT OR ENTERING INTO ANY TRANSACTIONS.