:: Australian Dollar: Volatility continued yesterday with the Aussie opening at 0.8320, then hitting an intraday low of 0.8184 before bouncing back to 0.8300 – and this was just the first few hours. Risk aversion and a wave of selling out of Japan kept the local unit pinned down during the domestic session. The Aussie hit a 24-hour high of 0.8350 during the European session before succumbing once more to a stronger greenback after U.S. existing home sales came in stronger-than-expected surging 7.6 per cent in April for the strongest reading in six months.
- We expect a range today in the AUD/USD rate of 0.8150 to 0.8350
:: Great Britain Pound: The pound opens steady against the greenback today at 1.4420 as the U.K’s new Chancellor of the Exchequer George Osborne announced GBP6.25bio worth of budget cuts. Fiscal deficit concerns have plagued Sterling this year and broader plans will be announced at an emergency budget set down for June 22. In overnight trade, the pound moved between a low of 1.4351 and a high of 1.4527. Meanwhile, the pound is higher against both the Australian Dollar (1.7443) and the New Zealand Dollar (2.1540).
- We expect a range today in the GBP/AUD rate of 1.7350 to 1.7510
:: New Zealand Dollar: The New Zealand Dollar opens US1-cent lower today at 0.6690 after another tumultuous session. The kiwi followed a weaker Australian Dollar lower during Monday’s domestic session hitting 0.6688. A rally during the European time zone was short-lived as the greenback strengthened across the board after U.S. existing home sales came in stronger-than-expected surging 7.6 per cent in April for the strongest reading in six months. With the 16-nation Euro zone currency shedding last week’s gains overnight, risk currencies such as the Aussie and the kiwi are expected to remain volatile and under pressure today.
- We expect a range today in the NZD/USD rate of 0.6610 to 0.6820
:: Majors: Last week’s 1.7 per cent gains on the Euro largely evaporated overnight on speculation European financial institutions linked to Greek debt holdings may face losses. The 16-nation currency opens at 1.2360 against the greenback after hitting a session-low 1.2343. Fuelling the renewed bout of negative sentiment was news that the Spanish Central Bank appointed a provisional administrator to run CajaSur – a savings bank crippled by property loan defaults. Meanwhile, the big dollar opens higher against the Japanese Yen at 90.25.
:: Data Releases: AUD: No data today CAD: No data today EUR: No data today GBP: GDP, Q1 JPY: No data today NZD: No data today USD: House Price Index, March; Richmond Fed Mfg, Consumer Confidence, May