:: Australian Dollar: The Australian Dollar opens little-changed from this time yesterday at 0.7120 but has experienced another wide 24-hour range. The Aussie moved lower during local trade as investors sold the high-yielding currency after poor building approvals data, which fell 12.8 per cent in November for the lowest number since March 2001. The sell-off continued in European trade where the local unit hit an overnight low of 0.6954 before staging a steady comeback throughout the entire New York session hitting a high of 0.7138. Risk-aversion and movements in equity markets remain the keys for the Aussie's near-term direction and moves to the upside today are likely to be limited.
- We expect a range today in the AUD/USD rate of 0.7050 to 0.7180
:: Great Britain Pound: Pound Sterling opens higher against the greenback at 1.5224 and had another busy night trading between a low of 1.4981 and a high of 1.5373. The Bank of England cut its benchmark interest rate by 50 basis points to 1.5 per cent, the lowest level since the bank was founded in 1694. The pound moved higher after this announcement as many investors had expected a larger reduction. Meanwhile, the pound has also strengthened against the Australian Dollar and opens at 2.1430 and also the New Zealand Dollar which is currently trading at 2.5622.
- We expect a range today in the GBP/AUD rate of 2.1200 to 2.1550
:: New Zealand Dollar: The New Zealand Dollar opens marginally higher than this time yesterday at 0.5943 but is not showing any signs of re-capturing US60 cents in a hurry. The kiwi tracked movements in its trans-Tasman rival throughout most of the offshore session moving to an overnight low in Europe of 0.5810. Investors and yield-chasers came out of the woodwork however when the Bank of England reduced interest rates to an all-time low of 1.5 per cent and the local unit climbed steadily for the remainder of the session to 0.5960 where strong resistance remains.
- We expect a range today in the NZD/USD rate of 0.5850 to 0.5980
:: Majors: The US Dollar moved lower against the Japanese Yen overnight ahead of tonight's US non-farm payrolls data. The report is expected to reveal the economy lost jobs in every month of 2008 and the unemployment rate is likely to rise to a 16-year high. Investors took the safe-haven option of the Japanese yen pushing the big dollar down to an overnight low of 90.82. Meanwhile in Europe, German manufacturing orders and exports both dropped sharply in November further underlining the case for further interest rate cuts in the region to limit the effects of the recession. The Euro opens today at 1.5224 after hitting an overnight low of 1.3533.
:: Data Releases:
• AUD: No data expected
• CAD: Unemployment rate, Dec; Housing Starts, Dec
• EUR: German Retail Sales, Nov
• GBP: Producer Price Index, Dec; Industrial Production, Nov
• JPY: No data expected
• NZD: Performance of Manufacturing Index, Dec
• USD: Non-Farm Payrolls, Dec; Wholesale Inventories, Nov
:: Note: The above exchange rates are based on interbank rates. If you are considering a transfer then please login, register or call us for a live dealing rate.