:: Australian Dollar: Nervous long AUD positions were wound down in early Asia yesterday as the local market anticipated the conclusion of the RBA meeting and the impending interest rate decision. After opening the morning above the 92 cent mark the AUD/USD was exchanging around 0.9165 as the central bank announced a further 0.25% increase in the official cash rate to take rates up to 4.25%. The immediate reaction saw the currency jump back above the 92 cent handle before finding some resistance around 0.9250. Offshore investors continued to snap up Aussie dollars and it opens this morning near the highs around 0.9275 with USD weakness on the back of the FOMC minutes also adding to support.

- We expect a range today in the AUD/USD rate of 0.9240 to 0.9325 

:: Great Britain Pound: After dipping to an overnight low of 1.5130 the Cable bounced back in spectacular fashion overnight to open this morning on its highs at 1.5270. U.K Construction PMI beat expectations of a marginal increase from 48.5 to 48.7 to post a reading of 53.1, sparking the move with a lower Greenback across the board also adding momentum to the move higher. The GBP/AUD cross rate collapsed late Asia yesterday following the RBA increasing interest rates falling from above 1.6600 to a low near 1.6350 overnight however the rally in the Pound Sterling helped the cross bounce slightly to open this morning around 1.6450. 

- We expect a range today in the GBP/AUD rate of 1.6380 to 1.6520 

:: New Zealand Dollar: With no N.Z economic data for direction the Kiwi continues to take its cue from the Aussie dollar and developments in North America to open this morning relatively unchanged from yesterday's open at 0.7065. Offshore investors initially took the NZD/USD back below the 70 cent handle to a low of 0.6965 as demand for AUD/NZD and U.S dollars persisted in European trade. The move reversed however following the release of the U.S Federal Reserve bank minutes from the last meeting and with the central bank still concerned about high unemployment the Greenback weakened. The AUD/NZD cross rate opens this morning at 1.3135 after having exchanged above 1.3200 for the first time since November 2000 with widening interest rate differentials between Australia and New Zealand increasing demand. 

- We expect a range today in the NZD/USD rate of 0.7000 to 0.7100 

:: Majors: The Yen strengthened in Asia yesterday following some upbeat Japanese economic data in the form of two indexes known as the Leading Index and the Coincident Index which are considered to be forward looking measures. After opening on its highs near 94.40, USD/JPY drifted lower throughout the session continuing the theme during early offshore exchange before finding a base around 93.80 in Europe. The Sentix measure of investor confidence in the Euro-zone passed by with little reaction despite a much better than expected reading of 2.5 as investors eyed the release of U.S Federal Reserve Bank minutes. The central bank retained the mantra that current exceptionally low levels of interest rates will remain for an extended period of time and pointed to concerns surrounding high unemployment stifling economic growth. In all the minutes were quite sombre with the Greenback softening as a consequence to reach a low of 93.65 Yen and 1.3410 Euro after having reached 1.3355 against the latter in the lead up to the release. 

:: Data Releases:

  • AUD: Mar AiG Service Index
  • NZD: No Data Expected Today
  • USD: FedSpeak
  • GBP: Mar PMI Services
  • EUR: Mar PMI, Feb PPI & Q4 GDP
  • JPY: BoJ Rate Decision