Market Brief
AUDUSD recovered from Friday's losses and traded at 0.9076 on speculation that retail sales rose 0.3% in February, due on March 31 and as RBA Governor Glenn Stevens said house prices are getting quite high and signaled that interest rates may need to be increased further to contain inflation adding that it was important for borrowing costs to be returned to normal levels. With Prime Minister Kevin Rudd announcing A$50 million in spending as part of the government's A$512 million Housing Affordability Fund, supply of housing could be unlocked and along with uptick in retail sales and a much needed boost to the housing market, case for further increase in interest rates could be stronger thus giving a boost to the AUDUSD to move on the upside with further gains on the anvil after crossing the 0.9066 key level. Sales of new homes reported a decline of 5.2% in February (previous +9.2%).Meanwhile, the USDJPY rose as signs the global economic recovery is gathering momentum sparked demand for higher-yielding assets. The pair rose to 92.67 staying above the 92.45 support level and moving toward an 11-week high of 92.96 before reports this week could show the US labor market is improving. With Japan's retail sales reporting gains of 4.2% (expectation 1.6%) from a year earlier, the fastest pace in more than a decade in February, a drop in the unemployment rate is feeding through to higher household spending. With unemployment levels expected to hold at a 10 month low of 4.9% tomorrow, higher sentiment may help offset the unwinding of emergency government spending programs that gave consumers incentives to spend. Despite positive figures from Japan, market analysts do not expect the economy to recover at a faster pace as a halt in job losses haven't yet restarted the recovery momentum and the Japanese economy has to deal with the newly added quantitative easing measures to show signs of faster pace of recovery.

The EURUSD rose for a second day on receding concern Greece's financial crisis will derail the EU's economic recovery. The EURUSD strengthened to 1.3440 staying above 1.3425 key levels in early trade advancing before a report today forecast to show European economic confidence rose to 97.1 this month from 95.9 in February the highest since June 2008 and builds on gains last week after the EU and IMF pledged to help Greece finance its budget deficit. ECB Governing Council Member Bini-Smaghi said that the ECB's independence on monetary policy will not be compromised because of the IMF's possible involvement in any future bailout of Greece thus giving hope to the fragile currency that further downside risks could possibly be limited.

The USD could continue its rally as the US is expected to add 190,000 jobs in March, the most in three years, according to analyst estimates before the data is due on April 2. The Federal Reserve has pledged to keep benchmark rates low for an extended period to support an economic recovery. As jobs data improve, expectations may rise that the Fed will remove 'an extended period' language in late April and the USDJPY could remain in an uptrend. ADP Employer Services is also forecast to report on March 31 that US firms added 40,000 jobs this month, halting job losses that have lasted for two years.

G10 Advancers and Decliners vs USD









Global IndexesCurrent Level% Change
Nikkei 225 Index10963.27- 0.30
Hang Seng Index21210.64+ 0.75
Shanghai Index3122.15+ 2.04
FTSE futures5653.50- 0.46
DAX futures6120.00- 0.29
S&P future1186.90+ 0.29
DJIA futures10825.00+ 0.25

World MarketsCurrent Level% Change
Gold1106.80- 0.06
Silver17.01+ 0.65
Crude wti80.47+ 0.59
VIX17.77- 3.42
USD Index81.50- 0.13

Todays CalenderEstimatesPreviousCountry / GMT
Net Consumer Credit0.4B0.5BGBP/0930
Mortgage Approvals48.4K48.2KGBP/0930
Industrial Confidence-11-13EUR/1000
Consumer Confidence-17-17EUR/1000
Economic Confidence97.195.9EUR/1000
Personal Income0.1%0.1%USD/1330
Personal Spending0.3%0.5%USD/1330
Dallas Fed. Manf. Activity5.2%-0.1%USD/1530
CPI (MoM)0.3%0.4%-
CPI (YoY)0.9%0.6%-
Jobless Rate4.9%4.9%JPY/0030
Industrial Production (MoM)-0.5%2.7%JPY/0030

Currency Tech
R 2: 1.3650
R 1: 1.3525
CURRENT: 1.3445
S 1: 1.3250
S 2: 1.3030

R 2: 94.45
R 1: 93.30
CURRENT: 92.40
S 1: 91.53
S 2: 90.80

R 2: 1.5170
R 1: 1.5080
CURRENT: 1.4913
S 1: 1.4784
S 2: 1.4650

R 2: 0.9329
R 1: 0.9252
CURRENT: 0.9050
S 1: 0.9066
S 2: 0.8945

R 2: 1.0400
R 1: 1.0320
CURRENT: 1.0243
S 1: 1.0070
S 2: 1.0000