:: Australian Dollar: The Australian Dollar opens sharply higher today at 0.8510. Despite a surprise drop in new capital spending, which fell 0.2 per cent in the first quarter, the Aussie rallied from an intraday low of 0.8220. First quarter GDP data is due for release next week with some estimates likely to be revised lower after the capital expenditure figure yesterday. Local equities moved more than 1 per cent higher pushing the unit towards 0.8330 as it headed into the European session. Offshore, once the Aussie broke through resistance at 0.8360, it climbed steadily as global stocks rallied and risk was back on the agenda.
- We expect a range today in the AUD/USD rate of 0.8380 to 0.8590
:: Great Britain Pound: Pound Sterling (1.4580) opens sharply higher against the greenback on Friday. A decline in risk aversion and a move away from the U.S. Dollar as a safe haven were the main reasons for the pound snapping a 3-day losing streak. Only a week ago, the currency was trading at a 14-month low of 1.4231. Meanwhile, the pound has been outperformed by its antipodean rivals and opens at 1.7120 against the Australian Dollar and 2.1300 versus the New Zealand dollar.
- We expect a range today in the GBP/AUD rate of 1.7050 to 1.7180
:: New Zealand Dollar: The New Zealand Dollar opens higher against the greenback today at 0.6825. The Kiwi rallied steadily during local trade on Thursday pushing above US67 cents after New Zealand recorded its first annual trade surplus in eight years. During the offshore session, the unit moved through technical resistance at 0.6720 and rallied steadily after U.S. growth data came in weaker-than-expected sending the greenback lower across the board. Meanwhile, on the cross-rates, the kiwi is buying 0.5530 euro and 0.4691 British Pounds.
- We expect a range today in the NZD/USD rate of 0.6750 to 0.6860
:: Majors: The Yen and the big dollar declined overnight as global stocks rallied dampening the safe-haven demand that has prevailed in recent weeks. The Euro (1.2366) moved higher against the greenback for the first time in three sessions after China said that it remains a long-term investor in Europe. The Chinese foreign exchange regulator said previous reports it was reviewing Euro holdings were “groundless”. Meanwhile, U.S. economic growth came in at an annualised 3 per cent which was less than economists’ forecasts and highlights the headwinds still facing the recovery. In a separate report, weekly jobless claims fell by a less-than-expected 14,000 to 460,000.
:: Data Releases: AUD: No data today CAD: No data today EUR: No data today GBP: No data today JPY: Jobless rate & CPI, April NZD: No data today USD: Personal Income & Spending, April; Chicago PMI, May