Australian Dollar
Expected Range 0.7470 – 0.7540
The Australian dollar retreated from an eighth month high when valued against its US Counterpart yesterday, following lower than expected Industrial production and retail sales prints from China. Having gained an astonishing 5.6 percent this month alone, softening expectations which surround Australia’s most important trade partner has been the single most important contributor to weakness overnight a sell off also helped along by lower oil prices. Suggesting that the Aussies run higher may have stretched too far investors sold the higher yielding asset down from an earlier high of 0.7593 to an eventual low of 0.7491. Opening this morning lower as the Aussie clings to the 75 US Cents mark all eyes will turn today to the RBA’s monetary policy minutes from last month’s meeting.
New Zealand Dollar
Expected Range 0.6620 – 0.6730
The New Zealand dollar has struggled during the early parts of this week, unable to find support up above resistance at 0.6750 when valued against its US Counterpart. In light of the fading risk-rally which has lit up markets over the past fortnight, a flat performance across global equity markets has also failed to provide any buying incentives. Opening this morning half a cent lower at 0.6664 the attention of investors today will turn to this morning’s speech in Auckland by RBNZ Governor Graeme Wheeler whilst US data flows tonight remains set to contribute significantly also to near-term direction.
Great British Pound
Expected Range 1.9010 – 1.9120
A stronger US dollar across the board has stopped the Great British Pound in its tracks over the past 24 hours, pushing the Sterling below the1.4300 mark briefly overnight. Trimming last week’s gains which saw the Pound accelerate well past levels of 1.4400 the bias has certainly been to the downside since as investors have favoured holding both the Greenback and the Yen ahead of Wednesday’s FOMC decision. In what’s likely to be a short-term window dictated by broader US dollar moves, domestic highlights on the horizon include Wednesday’s employment report ahead of the BOE”s policy announcement on Thursday. Lower against the Greenback, the Great British Pound opens stronger versus both the Australian dollar (1.9059) and the New Zealand Dollar (2.1459).
Majors
Expected Range N/A
Price activity was generally flat during a subdued session on Wall Street as global oil prices fell as much four percent amid concerns the markets six week bull run may have overshot the mark. Amid a raft of optimism which has essentially erased all of the markets lost ground, last night’s session whilst broadly uneventful has favoured the worlds reserve currency as the impressive gains notched up across the commodity space showed signs of flattening. Ahead of the Federal’s Reserves two day meeting which begins this evening, already there is a sense that investors are more comfortable in waiting out the next 48 hours given the release of several key macro pieces including numbers on retail sales and manufacturing. Whilst it’s not expected the Federal Reserve will make any changes to existing interest rate settings, the global economy certainly appears to be a much more stable place than the picture being painted only one month earlier. Stronger against the Yen this morning (113.821), the US dollar in notably higher also versus the euro (1.0978).