Australian Dollar:
The local currency has rallied off the back of upbeat employment figures released yesterday which have both printed significantly above forecast. The reports from the Australian Bureau of Statistics revealed that not only did the number of employed people increase by 42,000 for the month of May, but unemployment itself for the same month was also reduced to 6%. As these results confounded expectations of a 12,000 change in employment and an unemployment rate of 6.2% the Aussie spiked to intraday highs of 0.7793, and maintained those levels throughout the remainder of the trade session. The AUD starts trade today buying 77.55 US cents, and a lack of domestic data being released today means that to conclude the week AUD price action will be dictated by overseas economic announcements.
We expect a range today of AUD/USD 0.7720 – 0.7800
New Zealand Dollar:
After yesterday’s unanticipated rate cut from the RBNZ the Kiwi value was slashed to lows not seen in the past 5 years. Furthermore the current declining terms of trade, as well as concerns about falling dairy prices have continued to weigh the local currency down. Following the rate announcement the NZ Dollar traded sideways through the most part of the trade session, and in overnight markets positive US retail sales data and unemployment claims number did not help the Kiwi value. Overnight lows of 0.6964 were reached, and the NZ dollar opens today at NZD/USD 0.7012. With another clear economic docket on the horizon the Kiwi will once again look to the US for overnight announcements to provide direction.
Great British Pound:
The Cable has opened at similar levels today after a lack of data releases locally and abroad failed to provide any stimulus for the Pound Sterling. Highs of GBP/USD 1.5534 were met with lows of 1.5412, and the Pound sterling opens only slightly higher at 1.5517. Investor attention today will be focused on domestic construction data coming out later in the afternoon, as well as inflationary reports being released out of the US. The Pound also opens at GBP/AUD 2.0004 and GBP/NZD 2.2117
We expect a range today of GBP/AUD 1.9970 – 2.0050
Majors:
The EUR/USD has slumped during yesterday’s session in the wake of negotiations seemingly coming to a standstill with the IMF team flying out of Brussels without making any progress on Greece’s current debt situation. European President Tusk has advised that Greece’s President Tsipras needs to decide whether or not to accept the terms to unlock financial aid instead of stalling. With Tusk also removing himself from the broker position of EU compromises Greece’s place in the Euro currency bloc has seriously been brought into question. In the US trader attention will look to inflationary data and consumer sentiment figures for any Greenback support. The EUR/USD opens today much lower at EUR/USD1.1250.
Data releases:
EUR: German WPI m/m, Industrial Production m/m
GBP: Construction Output m/m
JPY: Revised Industrial Production m/m, Tertiary Industry Activity m/m
NZD: Business NZ Manufacturing Index, FPI m/m
USD: PPI m/m, Core PPI m/m, Prelim UoM Consumer Sentiment, Prelim UoM Inflation Expectations