Australian Dollar:
The Australian dollar continued edging higher throughout trade on Tuesday recovering all losses suffered in the immediate panic that followed market open on Monday and the unfolding Greek credit crunch. Opening at 0.7671 the Aussie was range bound for much of the domestic session bouncing of intraday lows of 0.7652 while struggling to break above short term resistance at 0.7690. The Aussie then found support as investors pushed the unit through 0.77 to touch session highs of 0.7724 before upbeat US consumer confidence arrested any hopes of an additional rally forcing the commodity driven currency backward. The AUD opens this morning buying 0.7704 U.S cents as attentions turn to domestic building approvals for macroeconomic direction amidst a heavy Chinese docket and the unfolding European saga that will like cap larger directional swings through the week and Sunday’s Greek referendum.
We expect a range today of 0.7580 – 0.7780
New Zealand Dollar:
The New Zealand dollar moved lower through trade on Tuesday after a decline in ANZ business confidence forced a sell off which continued throughout the domestic session. Breaking below 0.68 the Kiwi touched intraday lows of 0.6750 as heavy USD buying into months end compounded the dairy driven currencies downward trajectory. With little data on hand today direction will come from key offshore data events with the international docket laden with key Chinese and U.S data events.
We expect a range today of 0.6680 – 0.6850
Great British Pound:
Cable offered little for investors through trade on Tuesday maintaining a relatively tight trading range. A widening trade balance was offset by a jump in consumer confidence to levels not seen in 15 years and helped Sterling push through intraday highs of 1.5775. The rally was short lived as stronger than anticipated U.S consumer confidence and heavy greenback buying into the monthly close forced investors to give up gains and GBP edged back toward1.5690. Opening this morning buying 1.5713 attentions turn to key manufacturing PMI for signs the economic recovery remains on track.
We expect a range today of 2.0325 – 2.0575
Majors:
The Euro moved lower across the board Tuesday as investors prepared for what was an inevitable Greek default. Edging lower against the Greenback the euro moved through 1.12 touching intraday lows of 1.1111 before finding support as traders scrambled to cover shorted positions. Optimistic investors looked to opinion polls suggesting a ‘Yes’ vote may garner enough support in accepting bailout terms. Attentions are keenly focused on the outcome of the Greek Referendum and subsequent likelihood Greece will remain within the Eurozone with creditors clearly voicing suggestions a No vote will commit the Greeks to an exit path destined to bring long term financial hardship. The U.S dollar firmed through Tuesday benefitting from euro selling and heavy buying into months end. Stronger than anticipated consumer confidence helped bolster the macroeconomic landscape cancelling out a minor fall in Chicago PMI as attentions turn to prelim non-farm payroll numbers ahead of tomorrow official print.
Data releases:
AUD: AIG Manufacturing Index, Building Approvals and Commodity Prices
NZD: No Data
JPY: Tankan Manufacturing and Non-manufacturing Index and Final Manufacturing PMI
GBP: Manufacturing PMI, BoE Financial Stability Report and BoE Governor Carney Speaks
EUR: Italian, French, German and Eurozone Manufacturing PMI and Eurogroup Meeting
USD: ADP Non-Farm Employment Change, ISM Manufacturing, Construction Spending and Crude Oil Inventories.