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Volatility has returned to global markets as investors weigh cuts to economic growth projections for 2015. Oil prices fell below $80 per barrel overnight as US treasuries and the dollar remain bid amid their safe haven status. Yesterday was quite the seesaw day, starting with a big miss for US retail sales for the month of September.

Investors ditched stocks with fervor and ran into treasuries, at one point pushing the DOW Jones down more than 3% and pinning the US 10-year yield below 2%. As a result, stop-losses were tripped in the FX space as most major currencies pushed to their highest levels in a month versus the greenback.

Despite a late day rally by US equities, European and Asian bourses were another sea of red with most indices losing between 1% and 2% overnight. Data was limited with foreign exchange markets taking their cue from stocks and commodities. The US dollar staged a nice comeback versus the euro but commodity currencies such as AUD and CAD remain weak on the newest sell-off in headline oil prices.

The euro lost about 1% during the European session as bonds from the region’s periphery exploded amid the on-going crisis. It is becoming uncomfortably clear that Mario Draghi and the ECB need to expand stimulus in the region which would push the euro lower as funds flood the banking system. Despite a negative deposit rate, cheap bank loans and a thinly veiled plan to buy asset-backed securities, the market continues to tell Mr. Draghi that more is needed.

In the US, it is Thursday which means it is Jobless Claims Day. The number of applications for unemployment benefits in the U.S. unexpectedly dropped this week to 264,000, the lowest level in 14 years. This should help the dollar as weekly Jobless Claims are a significant leading indicator for the US economy. As these numbers continue to outperform, global investors will need to look at the US economy in a vacuum as it would appear the labor market projects economic strength from the greatest country in the world (shameless plug for America).

The Canadian dollar is once again trading near five year highs today following the continued sell-off in oil prices. This morning we had second tier Canadian data in the form of Foreign Stock Investment, which rose by $10.2B in August. The uptrend for USD/CAD remains strong as the market looks to September inflation tomorrow  morning to close out the week.

There is a rash of economic speakers today, headlined by the Fed’s Kocherlakota who speaks in Montana this morning and Mr. Bullard who speaks this afternoon in Washington, D.C. Fed speakers need to be watched closely following the very dovish remarks from Messrs. Evans and Fischer on Monday, which escalated the most recent dollar sell-off. It is earnings season in the US with Google and Goldman Sachs reporting this afternoon. Earnings for this quarter have once again been better than expected, and as equities are poised to open again in negative territory, there may be some hope in the short term. Nine days to my wedding. Be careful out there.

By Stephen Casey of Cambridge Mercantile Group