:: Australian Dollar: The Aussie dollar shrugged off some woeful local economic data yesterday to continue its recent surge higher. Despite a worse than expected Q1 house price index and another poor reading from ANZ Job Advertisements the AUD posted an intraday high of 0.7385. In London exchange the Aussie dipped to retest the psychological 73 cent mark on the back of a sell off in the Euro before bouncing back in a big way to trade above 74 cents for the first time since October last year. Demand for the high yielding Australian dollar came from offshore investors pinning their hopes on early signs of a recovery in the U.S and global economy. Another supporting factor for the AUD comes in the form of today’s RBA meeting where interest rates are expected to remain on hold at 3% with intraday support at 0.7365 holding the key to any further upside momentum in Asia today.
- We expect a range today in the AUD/USD rate of 0.7335 to 0.7445
:: Great Britain Pound: Despite no U.K economic data released on Monday the Pound Sterling remained volatile, tracking movements in the Greenback and Euro overnight. The GBP/USD survived an early sell off from 1.4970 to 1.4840 only to bounce back in dramatic fashion to open this morning above the 1.5 handle with several key pieces of information looming later in the week. Thursday promises to be a very important day with the Bank of England and Bank of Japan meeting to be followed by the results of the stress tests on U.S banks. A big rally in the Aussie dollar offset the gains made by the Pound to see the GBP/AUD cross rate open relatively unchanged this morning at 2.0300 with the RBA expected to keep interest rates on hold today.
- We expect a range today in the GBP/AUD rate of 2.0220 to 2.0350
:: New Zealand Dollar: Yesterday’s New Zealand average hourly earnings data gave the Kiwi dollar a boost in local trade pushing it towards its highs around 0.5750 heading into offshore trade. The Kiwi opens this morning hovering around these same levels, seemingly unchanged at 0.5755 after having bounced around in a 50 point range between 0.5710 and 0.5760 for the majority of the European and U.S time-zones. With risk appetite opening up again following better than expected U.S housing data equity markets rallied over 2% overnight and one would have expected the NZD to be higher this morning, however with demand for the AUD/NZD cross rate persisting the NZD/USD struggled to gain any further momentum.
- We expect a range today in the NZD/USD rate of 0.5700 to 0.5780
:: Majors: The Euro plummeted in early offshore trade falling from above 1.3320 to an overnight low of 1.3210 following some worse than expected European economic data and further downward revisions to Euro-Zone GDP forecasts. German Retail Sales dropped 1% in March against economist forecasts of a slight 0.2% increase taking the year to date losses to -1.5%. Sentiment improved however in New York trade and EUR/USD bounced back in a big way after the release of the second consecutive monthly gains in U.S Pending Home Sales and Construction Spending during the month of March. With a clear sign that the U.S housing market may have seen a bottom global risk appetite improved, equity markets rallied and EUR/JPY, a strong indicator of risk appetite, rallied. The major cross rate jumped from 131.30 to an eventual high of 132.85 taking EUR/USD back towards 1.3420. A major hurdle to the recent trend looms near in the form of Thursday’s results of the so called “stress tests” conducte d on the U.S banking system with any unexpected negative news surrounding the banks likely to put a dent in recent gains on Wall Street.
:: Data Releases:
• AUD: RBA Interest Rate Decision & Mar Building Approvals
• NZD: Apr ANZ Commodity prices
• USD: Apr ISM Non-Manufacturing Index
• GBP: Apr PMI Construction
• EUR: Mar PPI
• JPY: No Data Expected today
• CAD: No Data Expected today
:: 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.