The Aussie dollar has taken another swipe at US dollar parity overnight with price action briefly moving to highs of 100.05 US cents overnight. We're seeing mildly positive direction from US equities which are helping risk assets to regain some ground against the greenback with some robust data from the Euro-zone also supporting the local units cause.
This theme of US dollar weakness played out against most major counterparts, with sterling, Euro and the commodity bloc all recording solid gains. The US dollar index which measures the value of the greenback against six major counterparts is currently trading at 78.97 down 0.54 percent on the day.
Across the Atlantic, sterling continued on its north bound trajectory after December Consumer Price Index showed inflationary pressure remain stubbornly high. December's numbers well and truly outstripped consensus estimates to record 3.7 percent growth against the expected 3.3 percent - adding further weight behind a near-term rate hike by the Bank of England or at the very least strengthen the divide between BoE members.
After a period of weakness yesterday, the Euro regained the lost ground against the greenback rising to highs of US$1.3468. A strong result from the Zew survey for economic sentiment and positivity surrounding the Economic and financial affairs council in Brussels assisted the Euro higher - however the Euro slipped from highs over the course of trade to current levels of around 1.3390.
Locally the day ahead brings little in the way of major market moving themes; however a strong equity market could bode well for the fortunes of the Aussie with another attempt at US dollar parity currently playing out - however we do expect current levels of around 99.9 US cents to hold considerable resistance in domestic trade. Local economic feedback today includes Westpac consumer confidence data.