:: Australian Dollar: The Aussie dollar experienced a roller coaster ride over the last 24 hours dropping to 0.8920 in Asia before bouncing back to 90 cents in early Europe only to retest 0.8920 in North American trade overnight. The announcement of July employment data out of Australia yesterday was met with caution despite the economy adding 23.5k jobs in the month, a result which was slightly above economist forecasts of a rise of 20k. With investors nervous about risky assets at the moment the focus instead was on the fact that the rises came in part time employment with full time employment decreasing and coupled with a rise in the participation rate, the headline unemployment rate actually rose from 5.1% to 5.3%. These weighed on the Aussie in local trade yesterday and with poor European economic data released overnight rallies on the AUD/USD were short lived. The Aussie opens this morning at 0.8960 with the recent range between 0.8920 and 0.9000 expected to hold in Asia today before this evenings European and U.S economic data releases.
- We expect a range today in the AUD/USD rate of 0.8920 to 0.9000
:: Great Britain Pound: The Cable ran into some solid resistance above 1.5700 in early London exchange as the market flocked to the safety of the Greenback following some disappointing European Industrial Production data. After momentarily holding up around the 1.5620 level it eventually gave way to more selling pressure and opens this morning near its lows at 1.5575. The weaker Pound puts the GBP/AUD cross rate lower as well at 1.7385 down from yesterdays Asian intraday high of 1.7535.
- We expect a range today in the GBP/AUD rate of 1.7320 to 1.7480
:: New Zealand Dollar: Reaction on currency markets to yesterdays N.Z economic data was fairly muted with Food Prices increasing and the Manufacturing Index contracting. The Kiwi traded sideways around 0.7120 for the majority of the Asian session before staging a rally late in the day to peak at 0.7160. European investors steered away from the high yielding NZD pushing it back below the 71 cent handle to open this morning at 0.7085. The AUD/NZD cross rate opens higher this morning exchanging around its early May highs at 1.2635. Today sees the release of the all important N.Z June Retail Sales with economists forecasting a slight rise from 0.4% the previous month.
- We expect a range today in the NZD/USD rate of 0.7050 to 0.7125
:: Majors: EUR/USD rallied in Asia yesterday clawing back some of its recent losses to bounce back from a low of 1.2830 to enter offshore exchange hovering around the 1.29 handle. An unexpected 0.1% drop in Euro-zone Industrial Output coupled with concerns surrounding the Greek economy (GDP declining and unemployment increasing) triggered another sell off in the EUR overnight however pushing it to a low of 1.2780 against the Greenback. Weekly jobless claims in the U.S increased reinforcing slowing employment growth stateside sending North American equity markets lower on the open and dragging down risk appetite once again. Support on EUR/USD held firm though and it opens this morning at 1.2825 whilst USD/JPY bounced back from another dip below 85 in Asia to open this morning near its overnight highs at 85.90. Whilst data releases in Asia today are fairly limited this evening sees some key information from Europe and the U.S which are sure to keep the big dollar volatile against the other majors.
:: Data Releases:
- AUD: No Data Expected Today
- NZD: Jun Retail Sales & Jul REI NZ House Price Index
- USD: Jul CPI, Jul Retail Sales & Aug Prelim Uni of Michigan Confidence Survey
- GBP: No Data Expected Today
- EUR: Q2 Prelim GDP & Jun Trade Balance
- JPY: BoJ Monetary Policy Minutes
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