Gold is rallying again today up off of $1,200 and €1,050 support suggesting that its recent correction has ended and its underlying uptrend getting underway again. With Greece moving back to the back burner for now and political risks having died down for the moment, focus has turned back toward money supply. What is most interesting about today’s rally is that it comes on a day when USD is also climbing relative to other majors. This suggests that gold’s action is more related to developments overseas. Recall that for the last five years, the trend in gold has more or less followed by trend in the ECB’s balance sheet rising through the initial emergency measures then falling through the ECB’s stealth taper of LTRO repayments. With the ECB poised to launch its new €60B per month QE program as soon as next week, gold appears to be climbing on speculation that the ECB may finally be getting serious about growing its balance sheet again. ECB and the pegged DKK are underperforming their peers today also on anticipation of increasing European money supply. Crude oil continues its seesaw trend falling today after climbing yesterday sending CAD and NOK moderately backward in tandem. NZD has been the top performer in currency markets overnight after New Zealand posted a surprise trade surplus. USD is the second best performing currency today while CAD is not down as much as other resource currencies. North American inflation reports came out this morning. Canadian headline inflation did not fall as much as had been expected and core inflation rose while US CPI inflation was in line with expectations and house prices rose more than expected. Other US data was mixed with durable goods rising more than expected while jobless claims were worse than expected and climbed back above 300K. Overall, this data means that deflationary pressures are contained in North America so neither the Fed nor the Bank of Canada need to be as dovish as some of their peers. Corporate News CIBC $2.36 vs street $2.27, raises dividend by 2.9% TD Bank $1.12 as expected, raises dividend by 8.5% Canadian Tire $2.44 vs street $2.52, same store sales up 2.8% at Cdn Tire, 4.9% at Forzain, 1.2% at Mark’s Work Wearhouse Loblaw $0.96 vs street $0.89 Economic News Economic reports released overnight and this morning include: Canada consumer prices 1.0% vs street 0.8% vs previous 1.5% Canada core CPI 2.2% vs street 2.1% US consumer prices (0.1%) as expected vs previous 0.8% US core CPI 1.6% as expected US durable goods orders 2.8% vs street 1.6% US durables ex transport 0.3% vs street 0.5% US jobless claims 313K vs street 290K US house prices 0.8% vs street 0.5% Germany unemployment chnge (20K) vs street (10K) Germany unemployment rate 6.5% as expected Spain GDP 2.0% as expected Sweden trade balance SEK 3.5B vs street SEK 4.0B Italy retail sales 0.1% vs street (2.0%) UK GDP 2.7% as expected NZ trade balance $56M vs street ($158M) Singapore industrial production 0.9% vs street 3.3% Economic reports due later today include: 10:30 am EST US natural gas storage street (236 BCF)