Global market activity overnight saw the 'Dubai Jitters' take a back seat to a renewed sense of optimism spurring on higher yielding investments, true to form the greenback came off second best. The US dollar index which measures the dollar's value relative to six major foreign currencies declined 0.60 per cent to 74.43.

A primary market driver was yesterday's Chinese Manufacturing Data which saw the Purchasing Managers Index (PMI) conducted by HSBC Holdings rise to 55.7 from 55.4, which suggests manufacturing in china is accelerating at the fast pace since 2004.

In contrast government Chinese Manufacturing data showed early signs of consolidation, with the official Purchasing Managers Index (PMI) holding steady at 18 month highs recording a seasonally adjusted 55.2 for the month of October, against a predicted increase to 55.7. We also saw Euro-zone PMI grow to a level of 51.2 in November from a previous 50.7, beating the consensus for a rise to 51.

We did however see a mixed bag of economic data from the UK and the States with the UK Purchasing Managers Index for November failing to meet expectation, falling to 51.8 from a downwardly revised 53.4 in October. The US ISM manufacturing index declined to 53.6 in November from 55.7 in October. Although the expectation was not met, investors chose to concentrate on the positives, with a reading of 50 and above indicating economic expansion. The Standout indicator from the States was The Pending Home Sales which rose 3.7 per cent in October surpassing analysts' expectation of a decline of 0.6 per cent.

Yesterday the Bank of Japan announced a 10 trillion yen cash injection in the form of short-term loans to commercial banks in an effort to resurrect economic growth, in-turn assisting in the unwanted strength of the Japanese Yen. Recent weeks have seen Japanese officials warn against excessive strength of the Japanese Yen, which has surged to 14 year high against the greenback. As the Yen makes ground against major counterpart's japans exports become less price-competitive against competing economies, thus hampering an export fuelled recovery.

In contrast to the deflationary environment of Japan, the resilience of the Australian economy resulted in an unprecedented third consecutive rate hike of 25 bps bringing the overnight cash rate to 3.75 per cent. Although the market expectation was met, the ensuing minutes saw the Aussie dollar take a step back against major counterparts as investors were left in the dark on the future direction on interest rates. An overnight surge to higher yielding assets has kept the Aussie dollar well supported, currently trading near day highs at 92.55 US cents.