Australian Dollar
Expected Range 0.7510 – 0.7645
Having touched near 9 month highs at 0.7670 mid-week the Australian Dollar edged lower into the close on Friday. The Aussie’s advance stalled as investors looked to square positions, taking profit ahead of the weekend and forcing the AUD to intraday lows at 0.7596. The questions is has the rally ended? The AUD has advanced nearly 8.5% through March thus far with suggestions the short term rally could continue. Despite the speed of the current advance there is little in the way of technical resistance points between the Aussie and 0.78 U.S cents. A break above 0.77 could prompt another rally and run onto 0.78 should the RBA maintain its neutral policy outlook and investors continue to drive the Greenback lower.
New Zealand Dollar
Expected Range 0.6680 – 0.6840
The New Zealand dollar relinquished some of Thursday’s gains edging lower into the weekly close as investors pared positions ahead of the weekend. Having touched near 9 month highs at 0.6873 on Thursday the Kiwi moved back through 0.68 as markets took stock and stepped back to review yet another Greenback sell-off. Attentions today turn to mildly important macroeconomic queues for direction ahead of Thursday’s trade balance report.
Great British Pound
Expected Range 1.8850 – 1.9250
The Great British Pound edged marginally higher through trade on Friday holding onto gains earned in the aftermath of the Fed’s dovish monetary policy commentary and watchful evaluation of global growth conditions. Rallying over 4 cents mid-week investors looked to consolidate gains above 1.4450 pushing Cable to intraday highs at 1.4503. Wednesday’s Fed commentary closes the gap in monetary policy outlooks however fears of a Brexit and softer inflation expectations continue to hang over the pound capping any medium and longer term gains.
Majors
Expected Range N/A
The U.S Dollar advanced across the board Friday recouping some of the week’s earlier losses as investors looked to square positions into the weekly close. Having plunged to 17 month lows against the JPY and 5 week lows against the Euro in the aftermath of the Fed’s dovish monetary policy statement the rebound wasn’t enough to stop a third consecutive week of losses for the world’s base currency. A defensive bias has been established as markets look to manage U.S interest rate expectations and Wednesday’s dovish FOMC commentary and cautious review of global growth conditions only affirmed investor observations. The question is has the recent Greenback sell off been too hasty? Having outperformed the majority of major currencies through the 2nd half of 2015 the reversal in Dollar fortunes has been remarkable and the hype surrounding a Fed rate hike quickly forgotten. Bloomberg’s dollar index plunged 2% below the 200 day moving average and has fallen 4% through the year to date. The speed of the sell-off certainly suggests there is room for a recovery and tactical upturn however as global monetary conditions remain accommodative demand for emerging market and commodity led currencies will hold likely through the short term. Attentions this week turn Core Durable goods orders and unemployment claims Thursday for direction into the Easter long weekend.