13:25 EDT - Equity markets are largely driving USD/CAD direction, with
the 30-day moving average correlations between the S&P 500 at -0.91
and VIX at 0.82, according to CQG. "As the global economy and
developments in the euro-zone gets worse, it also gets reflected in
stocks and in turn, higher-beta currencies that have this relationship
with the S&P 500," said BBH's Mark McCormick. Meanwhile, EUR
outperforms CAD as well as AUD and NZD as they feel the pinch from the
theme of slowing global growth. CAD receives some support from its
ties to the US economy. "[That's] somewhat of bright spot when you
look at industrialized countries, as it's not in a recession, and,
that while it's got a looming fiscal cliff, it's not yet a certainty,"
McCormick said. (david.george-cosh@dowjones.com)
Call us at (212) 416-2181 or john.shipman@dowjones.com
(END) Dow Jones Newswires
July 23, 2012 13:25 ET (17:25 GMT)
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