Australian Dollar:
The Aussie opens virtually unchanged this morning as yesterday’s session failed to provide any stimulus for the higher yielding currency. A slight rally in the Australian dollar was experienced early in the Asian session due to upbeat NAB business confidence figures, however this surge was short lived as Chinese inflation data for May was released that trailed forecasts. The AUD/USD saw intraday highs of 0.7723, and with little to no significant data being released abroad through overnight markets the local currency commences trade today at 0.7686. Investor attention will turn to upcoming Westpac consumer sentiment numbers being printed, as well as RBA Governor Stevens speaking at the Economic Society of Australia in Melbourne later in the afternoon.
We expect a range today of 0.7650 – 0.7730
New Zealand Dollar:
The NZ Dollar has remained range bound over the last trade session as traders anxiously await tomorrow’s rate decision from the local Reserve Bank. With no domestic data being released yesterday the Kiwi saw lows of NZD/USD 0.7083 countered by overnight highs of 0.7179, and as another clear economic docket is on the horizon today the upcoming rate decision will remain at the forefront of traders’ minds. There is some speculation that rates will be cut due to weak inflation and waning business/consumer confidence, however the general consensus is that rates will be held at 3.5%. The NZD/USD commences trade today at 0.7137.
Great British Pound:
The Pound Sterling has opened higher against most its major counterparts today as positive trade deficit figures were released yesterday. Trade balance results that were printed surpassed expectations of a decrease to 10 billion pounds, by showing that that the total trade deficit was actually reduced to 8.561 billion pounds in April. The Cable opens this morning at 1.5386, and starts trade today against its Australian and New Zealand counterparts at 2.0009 and 2.0542 respectively. With manufacturing production figures being released later today this announcement will look to have a significant impact on the Pound value as it is directly linked to consumer conditions i.e. wages and employment levels.
We expect a range today of GBP/AUD 1.9960 – 2.0040
Majors:
While trading within an extremely tight range yesterday due to a lack of data releases, the EUR/USD opens only slightly higher today at 1.1281. The currency pair has treaded water at familiar 1.12 levels over the last trade session as new plans have been put forward that could assist in improving discussions with Greece and their creditors. These proposals are currently being reviewed by the IMF and ECB, and if successful will hopefully keep the indebted country in line with budget targets, while at the same time not affect growth too severely. With another economic card clear of announcements today the currency pair will look to Thursdays US retails sales and unemployment data for any solid movements.
Data releases:
AUD: Westpac Consumer Sentiment, RBA Gov Stevens Speaks
EUR: French Industrial Production m/m, Italian Industrial Production m/m
GBP: Manufacturing Production m/m, NIESR GDP Estimate, BOE Gov Carney Speaks
JPY: Core Machinery Orders m/m, PPI y/y
USD: Crude Oil Inventories, 10-y Bond Auction, Federal Budget Balance