Month: October 2012

Source: ForexYard

The euro saw moderate gains against the US dollar in overnight trading, as a positive US manufacturing report from yesterday continued to boost risk appetite. That being said, the common currency remains close to a recent three-week low, and analysts are warning that bearish movement may continue occurring until Spain makes a formal request for a bailout package. The Australian dollar fell to a one-month low against the greenback last night after RBA unexpectedly decided to cut Australian interest rates.

Main News for Today

UK Construction PMI- 08:30 GMT
• The British pound has seen significant bearish movement against the US dollar in recent days
• Any better than expected data today could help sterling recover some of its recent losses

Read more forex news on our forex blog

Forex Market Analysis provided by ForexYard.

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By Central Bank News
Here’s today’s Central Bank News link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don’t miss any important news.

By Central Bank News

    The central bank of Australia cut its cash rate by 25 basis points to 3.25 percent, a move that was expected by some economists, saying the outlook for growth had weakened while inflation was expected to be in line with the bank’s target.
    “The outlook for growth in the world economy has softened over recent months, with estimates for global GDP being edged down, and risks to the outlook still seen to be on the downside,” the Reserve Bank of Australia (RBA) said in a statement, quoting its governor Glenn Stevens.
    The bank said growth in the United States remains modest, Europe is contracting while China’s economy has also slowed and “uncertainty about near-term prospects is greater than it was some months ago.”
    Economic growth in Australia remains close to trend, the RBA said, helped by very large increases in capital spending in the mining and resources sector which has boosted Australia’s exports to China.
    But this investment is likely to peak next year, the RBA cautioned, and investments may be at a lower level than earlier expected.
     The bank also said consumption growth was firm in the first half of the year but some of that strength was temporary and the labor market has softened in recent months.
    This is the third rate cut by the RBA so far this year, following cuts in May and June for a total reduction of 100 basis points so far.
     
     The Australian economy expanded by 0.6 percent in the second quarter for a 3.7 percent annual rate, down from 4.3 percent in the first quarter. Consumer prices rose 1.20 percent in the second quarter , down from 1.6 percent.
     The RBA said inflation has remained low and the introduction of the carbon price is still affecting consumer prices and this will continue over the next couple of quarters. But moderate labor market conditions should contain pressure on on costs in non-resource sectors and improved productivity should also help keep inflation low.
    “The Bank’s assessment remains, at this point, that inflation will be consistent with the target over the next one to two years,” said the RBA, which targets inflation of 1-3 percent.
    www.CentralBankNews.info
    

By MoneyMorning.com.au

In recent years, China has quietly and methodically become the biggest player in the gold market.

The year is not over yet, but it already looks like China’s gold imports for 2012 will be the largest in the world – outdoing India for the first time ever.

Then consider that China is now the world’s largest gold producer as well. Last year its annual production crept up to 355 tonnes (from 345 in 2010). That rate of production puts Australia into second place at 270 tonnes.

China is on a mission to increase the size of its national holdings. Therefore NONE OF THIS GOLD LEAVES THE COUNTRY.

The speed they are mining tells you just how important this is to them. With just 6,328 tonnes of mine reserves left, China is mining its gold so fast it will exhaust its known supply in just 18 years…

Now China is importing as much gold as it can, and mining its own reserves as fast as possible, to satisfy its craving, to the extent it has been looking further afield recently.

Chinese gold companies have been buying gold companies all over the world this year.

We have seen this happening right here on the Australian market. Chinese gold company Zinjin has recently taken control of Western Australian stock Norton Gold Fields (ASX: NGF).

Then just last week, Shandong Mining moved on Focus Minerals (ASX: FML).

A few days later, Zhongrun Resources has offered up to $140 million to increase its share of Noble Minerals (ASX: NMG) up to a controlling 51.6%.

What exactly is going on?

In short – China is playing every card it can to secure supply and increase its gold stash.
So, how much have they grown?

That’s the thing, we have no idea.

Most countries update their gold holdings every year or so. But China keeps us in the dark.

We had to wait for seven years for the most recent update, which showed that China had nearly doubled its holdings to 1054 tonnes.

That was 3.5 years ago in April 2009.

Given the huge increase in imports and mine production since then, I’d expect the next increase in official holdings to be a big one.

The Only Reason China is Buying Gold

It’s tempting to have a guess, but it would be just that – a guess. For one thing we have to use official import figures which are almost certainly far lower than the real figures. China wants us to know they are importing, but it serves them to give us a watered down number.

If they aspire to compete with the US official holdings of 8,133 tonnes, then they have a way to go. The component countries of the European Union leave the US in the dust with 15,784 tonnes.

The big question is why is China hell bent on accumulating gold?

Simple – China has been working steadily to launch its currency, the Yuan, as an international currency. To do this, it helps to back its currency with gold.

But 1054 tonnes is simply not enough. If the euro and US dollar are any measure, they will need closer to 5,000-10,000 tonnes. So expect a much, much higher gold price if China seriously intends to accumulate as much as that.

My colleague, Greg Canavan of Sound Money. Sound Investments, makes another interesting point. When China finally announces its new official holding, if it is a real ‘shock and awe’ upgrade, then gold will inevitably ‘gap up’ in price on the news.

If the news comes on a weekend, as China likes to do these things, then gold could jump 25%, 50%, or 100% between Friday and Monday. In Greg’s words:

‘In effect, wealth would instantly transfer from bondholders to gold holders.

‘This revaluation would neutralise the losses China would incur on its FX reserves.

It would also provide a windfall for all the Chinese citizens who took The Party’s advice and accumulated gold and silver…thus offsetting the outrage resulting from the loss on the $3.73 trillion dollars of US debt sitting in its banks.

‘If China plays it right, it might just manage to maintain a stable society…and change the rules of the global financial system to its benefit.’

This could be a few years away yet. We waited seven years for the previous update, and it’s only been 3.5 years since then. But it’s a very bullish theme driving the gold market over the medium and long term.

Gold to Double?

In the short term we now have the Federal Reserve’s QE3 program. I wrote to you last week about what the latest round of money printing could do to precious metals prices.

In short – gold could reasonably double; and silver could rise even more.

I’ve tipped gold stocks intermittently for Diggers and Drillers readers over the years. However the recent set up for gold stocks is the best I’ve ever seen.

It’s so good that I’ve now tipped three new gold stocks in just six weeks. These are already sitting on good profits. The first is up 28% since late August, and the two stocks from just last week are on 8% and 12% already with plenty left in the tank.

But the favourite part of my job is actually getting to the mines. I put a lot of emphasis on getting my boots on the ground and having a look for myself.

When researching stocks, I firmly believe you will only ever know what’s really happening if you get on a plane, visit the mine, and have a look for yourself.

Sometimes the flashy company website simply doesn’t match the reality. You have to see the equipment, put your boots and hardhat on and get to the mine face, and most importantly meet the people making it happen. I can tell you this approach helped me dodge a few bullets in recent years, and it has also confirmed some potential winners.

Most recently I flew into outback Western Australia, to take a look at a great looking gold miner that has traced an epic turnaround story.

I took some footage on my visit so you could see exactly what I saw. If you’ve ever wondered what a fully operational gold mine, a million dollars of liquid gold, or outback gold exploration looks like – click on the picture below to enjoy the short video.

Diggers and Drillers Site Visit to Australia’s Best New Gold Stock

Dr. Alex Cowie
Editor, Diggers and Drillers

Related Articles

How to Make Money from the End of the Mining Boom

Is the World Running Short of Gold?

The Only Winner in the Currency Wars

This is What a Million Dollars of Liquid Gold Looks Like

By MoneyMorning.com.au

Back in 2001, just after 9/11, the Economist ran a cover with the headline The Day the World Changed. It felt right at the time. But when historians come to look back at our times I wonder if, vile as it was, that will really be the event they note as the trigger for the Western world changing.

Instead, if you look around you now you might wonder if it was instead the poster moment of the financial crisis – the fall of Lehman Brothers.

After all, the crisis is clearly changing global politics as fast as it is global finance. These things are obviously complicated but you can make a case that the Arab Spring was precipitated by fast rising food prices – something you can easily blame on QE – a clear and direct result of the financial crisis.

The crisis has also precipitated the sovereign debt disasters across Europe and is obviously responsible for the increasingly common protests they come with. It can be blamed for China’s spat with Japan: would China’s leaders be any more bothered about the Senkaku islands than usual if they weren’t keen to shift attention from their own export slowdown?

Unleashing Change Around the World

It is also responsible in part for various independence movements. Would Scotland have elected the Scottish National Party if its voters hadn’t perceived Labour as being financially incompetent? And would Catalonia be making a bid to take over tax raising powers from Madrid without Spain’s economic crisis?

Then of course there is quantitative easing (QE) itself. Printing money for too long and in too great a volume is a bad idea for many reasons, but one is that printing money eventually kills faith in money.

The legendary investor Sir John Templeton liked to point out that abusing weights and measures was a pretty fast way for a government to lose the trust of an electorate. And what is QE, something that changes the value of the dollar, pound and euro in your pocket, if it is not an abuse of a measure?

You could also blame the crisis for the fact that the size of Western governments is more likely to increase than decrease from here. Why? Inequality.

You can make a (pretty good) argument to say that rising inequality, in the form of falling real wages for the 99%, left consumers with no power to consume unless they borrowed to do so – another big contributory factor in the financial crisis.

But whether that is true or not doesn’t really matter. Inequality has become a political big deal across the West and that means politicians of all colours, even as they fail to deal with their budget deficits, are still trying to find new ways to redistribute.

This is why we have to put up with the interminable arguments about the introduction of wealth taxes; why not everyone is outraged by the Lib Dem idea [in Britain] that those earning over £50,000 should be forced to fund a greater share of the UK’s debt repayments than they have so far; and why most of France’s rich have already packed their bags for a multiyear sojourn in Monaco.

My point in all this is that the crisis has not just had economic effects. It has had huge political effects too. Add all these together and you can see that levels of both misery and uncertainty across the global economy are surely at something of an extreme.

That doesn’t necessarily matter from a purely investing point of view. The question, as Sandy Nairn and Jonathan Davis say in their new book, Templeton’s Way with Money, is just ‘how much negativity is already being discounted in the price of shares, bonds and other financial instruments’.

Usually when times are as tough – and in particular as unpredictable as this – investors are compensated in the form of very low valuations and thus a strong probability of high returns in the future. Hence the idea that one should ‘buy when there is blood on the streets’.

The Toxic Mixture of QE and Delusion

But there isn’t any blood. Yes, one or two markets, especially in Europe, are cheap on the basis of long-term valuations. But, thanks to a toxic mixture of QE and delusion, the US is certainly not.

Strategist Andrew Smithers suggests that while US equities should be ‘cheap in recognition of the risks’ they are instead expensive – 59% overvalued on Smithers’ preferred measures.

These are the cyclically adjusted p/e ratio, which looks at profits over a ten-year period, and Tobin’s Q, which compares share prices to the replacement value of assets. How long can that last?

Société Générale’s Albert Edwards thinks not very long.

His latest note suggested that everyone should slash their equity exposure to the bone, something he last suggested back in May 2008, on the basis that while QE might well provide the money to keep asset prices up for a while, investors will eventually lose faith and accept that Ben Bernanke’s ‘ruinous’ policies will one day or another ‘destroy the world’.

Something to bear in mind if you think your money might be safer in the US than Europe.

Merryn Somerset Webb
Contributing Editor, Money Morning

How the Collapse of Lehman’s Changed the World

By MoneyMorning.com.au

There’s something missing from the eurozone crisis.

By now, we’re all getting very used to hearing about Greece, Italy and Spain’s problems. We also hear plenty about how irritated the German establishment is with its feckless neighbours.

But France – the second-biggest power in the eurozone – has been keeping a surprisingly low profile. Since the presidential election in the late spring it has fallen from the headlines.

Those who expected new President Hollande to pick a fight over austerity measures have been disappointed. Indeed, some have described his budget – which was announced on Friday – as the ‘toughest in decades’.

Trouble is, it’s tough in all the wrong places – it will squeeze growth without fixing France’s debt problem. That could leave an already heavily indebted France looking more and more like one of the dodgy ‘peripheral’ countries that everyone is so worried about.

The French market could be in for a hard time when the next panic rolls around…

The French Budget: Lots More Tax, and a Little Less Spending

Hollande has come up with plans to cut France’s deficit – the amount the government spends over and above what it gets in taxes each year – to below 3% of GDP by the end of next year.

It’s currently around 4.5% of GDP.

In all, it means finding €37bn in savings. That might sound like a recipe for pretty severe austerity measures. However, the trouble with his budget is that he plans to do most of the heavy lifting by raising taxes, rather than cutting spending.

The budget raises the top rate of income tax from 45% to 75%. It also increases the number of people who have to pay a wealth tax. These measures are supposed to raise around two-thirds of the €37bn. The other third comes from public spending cuts. It also increases the number of people who have to pay a wealth tax and raises business taxes.

Why is this a bad idea? Because these tax increases may not bring in any extra money. The economist Arthur Laffer came up with theory of the ‘Laffer curve’. He argued that, as income tax rates begin to rise, people adjust their behaviour by working less – they don’t see the point, basically. Eventually the lost labour outweighs the impact of the higher rate.

Wealth taxes are also a bad idea because they encourage people to move their assets outside the reach of the taxman. As my colleague Merryn Somerset Webb points out, most attempts to tax wealth other than through inheritance and property have either failed or have had to be scaled back.

The lack of borders in the European Union makes this problem even worse. Already several wealthy citizens have threatened to leave France.

The chairman and chief executive of LVMH Moet Hennessy, Bernard Amault, caused uproar when he took out joint Belgian citizenship.

Meanwhile, many French citizens in the banking industry and business are thinking of moving to London. Earlier in year [UK Prime Minister] David Cameron said that those fleeing the new top tax rate would be welcome in the UK.

French Bond Markets Could be Next to See Turmoil

Even as taxes are raised, Hollande has few plans to cut state spending. Indeed, the latest proposals assume French spending remaining at 56% of GDP – in other words, the state doesn’t shrink at all.

As Ambrose Evans-Pritchard puts it in The Telegraph, France has a Nordic-sized state, but ‘without Nordic labour flexibility or Nordic free markets.’

This means that France’s national debt is likely to continue to climb. Indeed, it is hovering around the critical level of 90% of GDP.

While this doesn’t necessarily spell doom, it is seen as the point beyond which it becomes significantly harder for a country to deal with its debt problems, as the weight of the debt starts to inhibit growth.

The weak short-term growth prospects for the French economy are likely to make this even worse. Even the government now thinks that overall growth will be just 0.3% this year and less than 0.8% in 2013.

However, even those predictions are seen as too rosy. Other economists see GDP rising by 0.1% this year, and a similarly weak figure next year.

Aggressively raising taxes will only make growth even harder to come by. In short, says Pritchard, Hollande ‘has served up the most drastic retrenchment in forty years, at the worst possible time, and in the worst possible way.’

So, overall, the French economy is a lot more vulnerable to disappointment than most. Investors still price it as a ‘core’ eurozone economy, but in many ways it’s more like one of the troubled southern countries.

We may not see a bond market panic over France in the near future – too many other nations are in a worse state – but there’s more scope there for disappointment than in most markets.

Matthew Partridge
Contributing Writer, Money Morning

Publisher’s Note: This is an edited version of an article that originally appeared in MoneyWeek

From the Archives…

Why This Crisis Still Has a Long Way to Run
28-09-2012 – Kris Sayce

We Said This Four Years Ago, But Nobody Would Listen
27-09-2012 – Kris Sayce

The Grave Mistake of Telling the Truth
26-09-2012 – Murray Dawes

The Mission Creep Destroying Wealth Around the World
25-09-2012 – Tim Price

He Wobbles, He Flails, He Prints
24-09-2012 – Nick Hubble

The Next Big Eurozone Panic Could be Over France

USDCAD moves sideways in a range between 0.9780 and 0.9859. Support is at 0.9780, as long as this level holds, the price action in the range is treated as consolidation of the uptrend from 0.9632, one more rise to 0.9900 area to complete the upward move could be expected. On the downside, a breakdown below 0.9780 support will indicate that the rise from 0.9632 has completed at 0.9859 already, then the following downward movement could bring price back towards 0.9632 previous low.

Daily Forex Forecast

Elliott’s 70-year-old forecast applies in 2012

By Elliott Wave International

Adversity often visits people just as their future seems brightest.

At the same time, other people learn that when one of life’s doors closes, a window will open.

Both of these truisms describe the life of Ralph N. Elliott (1871-1948), the founder of the Wave Principle.

In the 1920s, Elliott became a successful business consultant. But his life of accomplishment and financial independence were in peril when he fell gravely ill. During months of recuperation, Elliott occupied his mind with a meticulous study of the stock market.

In other words: The door closed and the window opened. At 67, Elliott made a discovery.

Through a long illness the writer had the opportunity to study the available information concerning stock market behavior. Gradually the wild, senseless and apparently uncontrollable changes in prices from year to year, from month to month, or from day to day, linked themselves into a law-abiding rhythmic pattern of waves. This pattern seems to repeat itself over and over again. With knowledge of this law or phenomenon (that I have called the Wave Principle), it is possible to measure and forecast the various trends and corrections (Minor, Intermediate, Major and even movements of still greater degree) that go to complete a great cycle.

Ralph N. Elliott, R.N. Elliott’s Masterworks, pp. 154-155

In 1941, Elliott drew a chart of his long-term forecast based on the Wave Principle. The final label on that chart is the year 2012! (That chart is republished in the February 2012 Elliott Wave Theorist)

Amazingly, wave analysis thus far confirms Elliott’s 2012 forecast.

In the August 2012 Elliott Wave Theorist, subscribers receive a specific stock market overview through early 2013.

Indeed, EWI’s timing tools appear pointed to the exact month of a major stock market turning point.

Two observations lead us to the same month for the last upside gasp in the stock market.

The Elliott Wave Theorist, August 2012

Imagine: Today’s price pattern is in line with a forecast R.N. Elliott published 70 years ago!

To that end, EWI offers you a no-obligation education in Elliott Wave analysis. See below for details.

Learn the Why, What and How of Elliott Wave Analysis The Elliott Wave Crash Course is a series of three FREE videos that demolishes the widely held notion that news drives the markets. Each video will provide a basis for using Elliott wave analysis in your own trading and investing decisions. Access the Elliott Wave Crash Course now >>

By The Sizemore Letter

As I wrote back in August, it can be helpful at times to look over the shoulders of successful investors to see what their highest-conviction investments are.  And during times like these, when the economy is looking wobbly and the potential for a Eurozone meltdown is hanging over our heads like the sword of Damocles, that extra insight is all the more valuable.

Today, I’m going to take a look at one high-conviction dividend stock each from three investors whose skills I respect and whose track records have withstood the passing of a crisis or two.

The usual caveats apply; I’m basing this analysis on SEC filings that are reported on a time lag and may already be out of date by the time they become publicly available.  For these reasons, I will stick with large positions that the investor has held for a long period of time or new positions that I consider unlikely to have been sold so quickly.

Let’s start  with the granddaddy of modern value investors, Berkshire Hathaway’s ($BRK-A) Warren Buffett.

Mr. Buffett made quite a splash last year when he bet big on technology powerhouse International Business Machines (NYSE:$IBM).  It was his first major purchase in the tech sphere, and it quickly became one of Berkshire’s largest holdings.    Buffett added to his position last quarter, and IBM now accounts for nearly 18% of Berkshire’s portfolio.

The appeal of IBM is straightforward; Buffett was attracted by the stability of the company’s cash flows and its business model as a high-end service provider whose customers are locked in to long-term contracts.

But its qualifications as a “dividend stock” might be a little more controversial.  At current prices, IBM yields only 1.6%.  Still, this is roughly in line with the current yield on the 10-Year Treasury Note, and—importantly—IBM’s dividend rises every year.  IBM’s dividend rose 13% this year and 15% the year before.

Of course, this is nothing new.  IBM is a proud member of the Dividend Achievers index, an exclusive fraternity of stocks that have boosted their dividends for a minimum of ten consecutive years.

So while the current yield of 1.6% is a little uninspiring, it’s safe to assume investors buying IBM today will be enjoying cash payouts far higher in a couple years’ time than they would have had they opted to invest in bonds.

Next on the list is the “Warren Buffett of Canada,” Fairfax Financial Holdings (FRFHR) Chairman Prem Watsa.

Like Buffett, whom Watsa admires, Watsa built his financial empire around a solid insurance business, which provided him with a growing float to invest.  And like Buffett, Watsa is known for being a patient investor who often holds his best positions for 5-10 years or even longer.

Watsa’s track record speaks for itself.  According to research site GuruForus, Watsa has grown Fairfax’s book value by an astonishing 212% over the past ten years.  This compares to total returns of just 34.9% for the S&P 500.  Impressively, he actually made money in 2008.  Fairfax saw its book value rise 21% in the midst of the worst financial crisis in 100 years.

Diversified health and pharmaceutical company Johnson & Johnson (NYSE: $JNJ) is Watsa’s largest holding by far, and accounts for more than 21% of his listed portfolio.

Johnson & Johnson is an obvious choice for a conservative dividend stock, and it is a current holding on the Sizemore Investment Letter’s Drip and Forget Portfolio.

It also happens to be one of the highest-yielding major American blue chips, with a 3.5% dividend at current prices.  And like IBM, Johnson & Johnson has a long history of raising that dividend.  J&J is a member of the Dividend Achievers Index.

Given the low repute of ratings agencies this matters less than it used to, but Johnson & Johnson is one of only four American companies to have its bonds rated AAA.  Yes, Johnson & Johnson is actually considered to be less risky than the U.S. government, and its stock pays more in yield.  This is one you can buy and lock in a proverbial drawer.

Our final guru today is hedge fund manager and fellow Dallas resident Kyle Bass, principal of Hayman Advisors.  Though he does trade equities, Bass is a macro investor better known for making large bets in the credit and currency markets; he made his investors a small fortune betting against subprime mortgage securities in the run-up to the 2008 meltdown.

Bass’s equity portfolio is completely dominated by Six Flags Entertainment Corp (NYSE:$SIX), the owner and operator of theme parks.  Six Flags makes up nearly 40% of his equity holdings.

With a current yield of 4.1%, Six Flags certainly qualifies as a dividend stock.  But readers should consider this stock a riskier bet than IBM or Johnson & Johnson.  Theme parks are sensitive to the state of the economy, and the stock trades at a nosebleed valuation of 32 times expected 2013 earnings.  There is a lot of optimism built into the price at current levels.

All of this said, Bass has certainly done well by owning Six Flags—it’s up more than 100% over the past year—and he clearly has a high level of conviction in the stock if he’s make it nearly 40% of his equity portfolio.

Disclosures: Sizemore Capital is long JNJ.

Related posts:

• Five Smart Money Dividend Stocks
• Is There a Bubble In Dividend Stocks?
• Charles Sizemore Quoted in Smart Money

By TraderVox.com

Tradervox.com (Dublin) – As the global economic growth seems to falter, investors are seeking safety, which has forced safe haven currencies such as the yen and the dollar to strengthen. The last quarter favored commodity related currencies but as global central banks makes efforts to avert a global recession, safe haven currency will gain in the fourth quarter. Here are some of the events that will affect the market this week.

Monday 1

At 1400hrs GMT, the US ISM Manufacturing PMI will be released.  The index has dropped for the last three months coming at 49.6 in August. The market is expecting an increase to 50.0 for September. Another major report on this day will be the speech from Fed Chairman Ben Bernanke. He will be talking about the QE3 and the market is waiting to get a way forward.

Tuesday 2

The Australian rate decision is the major event on this day. The Reserve Bank of Australia has kept the rates unchanged at 3.5 percent and it is expected to maintain this level.

Wednesday 3

There are three major events on this day; the US ADP Non-Farm Employment Change, US ISM Non-Manufacturing PMI, and the US POMC Meeting Minutes. At 1215hrs GMT, the US ADP Non-Farm Employment Change report will be released. Economists are expecting a gain of 141,000 jobs lower than the previous gain of 173,000. The US ISM Non-Manufacturing PMI is expected to decline to 53.3 after it rose to 53.7 in August. The US FOMC Meeting Minutes report will be released at 1800hrs GMT where the market will get more insight on how the important decision was made.

Thursday 4

Three major reports will be released on this day. The UK rate decision, which will be known at 1100hrs, is expected to indicate no change in the current monetary policy. The Euro Zone rate decision will follow forty five minutes later, where the ECB may announce a cut in main lending rate by 0.25 percent. The US unemployment claims at 1230hrs GMT will be the last major event of the day. The market is expecting a rise to 371,000.

Friday 5

There are four major reports on this day; the first one being the Bank of Japan Rate Decision which is expected to be unchanged after the bank decided to add 10trillion yen to its bond buying fund. The other major report is the Canadian employment data. The Canadian dollar increased against the dollar in the last quarter and good performance in the job market may move the currency higher. The market expects an additional 15,300 jobs this time round.

From the US, the official US Non-Farm Employment change will be released at 1230hrs GMT. There was disappointment in August with an addition of only 96,000 jobs which pushed the Fed of the cliff to accepting another round of quantitative easing. The market is predicting an addition of 112,000 jobs this in September. This report will be released together with the US Unemployment rate which is expected to remain above 8 percent.

Disclaimer
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