Australian Dollar: The Australian Dollar opens lower on Tuesday at 0.9140 as the recent positive sentiment towards high-yielding currencies evaporated overnight as stocks and commodities both declined. During Monday's domestic session the unit traded briefly beneath US92 cents as local equities began trade in the red. Australia's PPI (producer price index) at the final stage of production came in slightly below expectation at 0.1 per cent for the September quarter however the local unit was well supported and moved to an intraday high of 0.9270. In overnight trade, the Aussie worked its way down to a low of 0.9124. Locally, range-trading could be the order of the day as currency markets await the outcome of tomorrow's key thi rd-quarter inflation data.

- We expect a range today in the AUD/USD rate of 0.9120 to 0.9200

Great Britain Pound: Pound Sterling opens higher on Tuesday at 1.6320 on speculation the dramatic moves lower last Friday were overdone. The Pound was reeling after third-quarter GDP spurred speculation that the Bank of England would need to expand its bond-purchasing program to keep a lid on borrowing costs. In overnight trade, the pound moved between a low of 1.6250 and a high of 1.6395. Meanwhile, the pound has moved higher against both the Australian Dollar (1.7820) and the New Zealand Dollar (2.1820).

- We expect a range today in the GBP/AUD rate of 1.7700 to 1.7900

New Zealand Dollar: The New Zealand Dollar opens lower on Tuesday at 0.7470 after a pause in the recent risk-based rally. Kiwi markets were closed on Monday for the annual labour day public holiday and trading volumes were down to a trickle compared to recent sessions. There is no local economic data due for release today however, looming large for the currency is this Thursday''s review of  the official cash rate by the Reserve Bank of New Zealand. Whilst rates are tipped to rise over time, the next hike is unlikely to occur this week which may keep a temporary lid on the kiwi.

- We expect a range today in the NZD/USD rate of 0.7420 to 0.7520

Majors: The big dollar staged its biggest intraday rally in more than two weeks against the Euro. The Euro opens at 1.4857 after traders formed the view that the recent move above 1.5000 would be difficult to sustain. The recent risk-based rally in high-yielding currencies paused overnight as stock markets in the U.K. and the U.S. both declined by 1 per cent (at time of writing). Commodity prices also moved lower. The greenback is largely unchanged against the Japanese Yen (92.20). Meanwhile, the Canadian Dollar opens lower at 1.0665 after the price of oil dipped to US$78.21 per barrel.

Data Releases:

  • AUD: No data today
  • CAD: No data today
  • EUR: No data today
  • GBP: No data today
  • JPY: No data today
  • NZD: No data today
  • USD: S & P/Case Shiller home price index, Aug; Richmond Fed Manufacturing Index, Oct

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