Australian Dollar
Expected Range 0.6840 – 0.6930
Global share markets once again tumbled overnight, as concerns over global growth prospects intensified. Lying at the heart of yesterday’s falls oil continued its slide, breaking briefly below the $US27 per barrel mark as energy stocks copped the brunt of the sell-off. Whilst a slowdown in China has significantly dented sentiment during the early parts of this year, a string of disappointing data flows from the United States has also added to the gloomy feel surrounding markets. Despite falling to a 24 hour low of 0.6827 when valued against its US Counterpart the Australian dollar opens only marginally lower compared to the same time yesterday as it currently buys 69.01 US Cents. On the domestic calendar today tier two data in the form of inflationary expectations will greet investors over the coming hours.
New Zealand Dollar
Expected Range 0.6350 – 0.6430
Revealing its smallest annual increase since 1999, figures on Wednesday showed New Zealand’s Consumer Price Index fell by 0.5 percent during the final quarter of last year, amid falling food and petrol prices. Cutting expectations which surround a potential interest hike later this year, such weak price pressures could in fact hint towards monetary easing. Struggling to advance for much of yesterday’s session, chaos across global equity markets also did the Kiwi few favours as Wall Street fell by close to three percent. Opening steady this morning at a rate of 0.6412 when valued against its US Counterpart, improved sentiment flows will be required if the New Zealand dollar is to capture any fresh upside.
Great British Pound
Expected Range 2.0470 -2.0580
The Great British Pound has consolidated over the past 24 hours, struggling to advance when valued against its US Counterpart despite job figures from December which showed UK unemployment fell to 5.1 percent, its lowest level since 2006. Overshadowed somewhat by wages which grew at a slower than previous pace, average earnings were higher by a disappointing 1.9 percent. Expected to run into strong resistance at 1.4240 when valued against its US Counterpart the Great British Pound opens steady this morning against the Greenback at a rate of 1.4152. Meanwhile versus both the Aussie (2.0522) and the Kiwi (2.2083) the Sterling is stronger.
Majors
Expected Range N/A
In a session dictated by aggressive selling, the S&P 500 hit its lowest level since February 2014 as the price of crude fell by a further 6.6 percent. Whilst oils slump acted as the main catalyst, data prints from the world’s largest economy proved to be far from supportive. Unexpectedly falling in December, US Consumer Prices dropped by 0.1 percent as the cost of gasoline fell and rents rose modestly. In other data prints housing starts and building permits last month also fell, adding to the weak economic backdrop which has revealed significant softness throughout the US economy during the back end of 2015. In what’s likely to temper the Fed’s confidence and appetite towards lifting borrowing costs, the positive wealth impact for households associated with lower energy prices flies in the face of the carnage witnessed across stock markets this year. In currency flows, risk sentiment has favoured the Japanese Yen which opens notably stronger versus the Greenback at 116.733, meanwhile the euro is lower at 1.0893.