Australian Dollar
Expected Range 0.7550 – 0.7680
The Australian Dollar finds itself buying 76.35 US cents this morning after a fairly quiet day the Australian Dollar was able to find support from the Fed Chair Yellen’s speech. Federal Reserve Chair Janet Yellen said that the Fed should proceed with caution in adjusting interest rates. Sighting the inflation outlook which she says has become more uncertain and uncertain global economic conditions as reasons for the caution. She did not mention when the Fed would look to raise interest rates however the markets expectations suggest that it might be pushed back to the second half of the year. With no data out locally the AUD will once again take direction from overseas markets.
New Zealand Dollar
Expected Range 0.6800 – 0.6900
After subdued trading during local time following the Easter Break the NZD was able to make late gains and open the day up over a cent. The good finish to the day has meant that the NZD has been able to recoup all of the losses from last week in two days. It has been supported by weakness in the USD following Yellen’s speech where she said that she expects only gradual movements by the Federal Reserve over the next few years. Only the minor release of the Building Consents m/m data out locally so expect external factors to be main contributors to the direction of the NZD. The NZD is currently buying 0.6851 USD.
Great British Pound
Expected Range 1.8700 – 1.8950
The Great British Pound finds itself 30 points down from yesterday’s open ending the run of 4 consecutive positive days. The GBP did hit an intraday high of 1.9003 in the lead up to Yellen’s speech with expectations that she would follow on from the hawkish statements by Fed Colleagues late last week. However she adopted a more dovish tone suggested that caution was to be used and that any rate rises would be gradual which saw the GBP lose all of the intraday gains to end the day buying 1.8861 AUD. The GBP opens this morning buying 1.4385 USD and 2.0979 NZD.
Majors
Expected Range N/A
The major talking point for the day has been Federal Reserve Chair Yellen and her speech at the Economic Club of New York. The Dovish tone from the Federal Reserve’s statement 2 weeks ago when they kept interest rates on hold at 0.5% had appeared to have been contradicted by members of the Federal Reserve last week coming out with hawkish statements and being bullish over the rate in which the interest rates would increase. Yellen’s speech today followed a similar tone to the statement as she reiterated that inflation and global growth weighed heavily on the US economy and should mean that the Fed exercise caution when raising rates. The US will have two major releases the ADP Non-Farm Employment change and the Crude Oil Inventories during the Wall Street session.