Daily forex forecast

By IBTimes Staff Reporter | April 28 2010 6:01 PM

:: Australian Dollar: The Australian Dollar opens at 0.9250 this morning higher against the Greenback after another night of volatile trade. The release yesterday of the quarterly Consumer Price Index came in stronger than expected with the number rising by 0.9% in the 3 months to March with the previous reading in December of 0.5% and therefore raises the chance of an interest rate hike when the Reserve Bank of Australia meets next Tuesday. The Australian Dollar initially rallied immediately after the release jumping up almost 30 pips from 0.9145 to 0.9185. In offshore trade the upward trend continued with the unit moving slowly and steadily up to hit an overnight high of 0.9266. There is no data due out locally thus direction for the Australian Dollar will be taken from offshore events and happenings.

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- We expect a range today in the AUD/USD rate of 0.9180 to 0.9280

:: Great Britain Pound: The continuing possibility of a hung parliament with the prospect of neither the Conservative Party, Labour Party or the Liberal Democrats having total control of government continues to undermine the Sterling. Last night CABLE (GBP/USD) traded between 1.5124 and 1.5243. With no data being released in the UK, Pound took it's queue from events in Europe and the US, with the main focus continuing to be Greece and how it will service its massive debt. Against the Australian and New Zealand Dollar, the Pound Sterling is changing hands at time of writing at 1.6401 and 2.1150 respectively.

- We expect a range today in the GBP/AUD rate of 1.6300 to 1.6500

:: New Zealand Dollar: The Reserve Bank of New Zealand as expected to left interest rates on hold at 2.5%. In the statement after the meeting, Governor Alan Bollard stated that the Reserve Bank could start raising rates as early as June as the economy continues to evolve as projected. On release of the news, the New Zealand Dollar lost significant ground against the Australian Dollar (1.2881) but was up against the Greenback (0.7190). Interest rates in NZ have remained unchanged since April 2009.

- We expect a range today in the NZD/USD rate of 0.7100 to 0.7200

:: Majors: Sovereign debt concerns in Europe and the downgrading in Greece and Portugal's credit rating to BB+ continued to weigh on the EURO overnight. In offshore trade, EURUSD moved between 1.3112 and 1.3275, with many investors growing more reluctant about buying into the 16 nation currency. There is a fear in Europe that the debt crisis could spill over into over countries and this will severely hamper any gains in the EURO in the short term. Across the Atlantic, the Federal Open Market Committee as expected left the overnight cash rate at 0.25% and expects rates to remain on hold for an extended period. In the accompanying statement the Federal Reserve indicated that the labour market is beginning to improve and that inflation is likely to remain subdued. The US Dollar is up against the Yen and hit an overnight high of 94.31.

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