Once again, European debt woes remained in the spotlight on Friday, dragging on US stocks on Friday erasing some of Thursday’s steep rise on the back of China's confirmation they will not be divesting in the Euro currency. Ratings agency Fitch cut Spain the grade one step yesterday to AA+ and assigned it a “stable” outlook - this comes a month after Standard and poor’s cut the nations rating to AA. The DOW and S&P lost 1.2 and 1.3 percent respectively. The Aussie dollar was no exception falling against the greenback after a solid few days. However still a far cry from the lows of 80 US cents over a week ago. Losses on the local unit were contained to the Greenback and Yen with mild strength against the crosses.

Despite the Greenback gaining the upper hand against major counterparts on Friday, the price of Gold remained buoyant around the US$1215 an ounce market. The obvious answer to the latest burst of energy from Gold remains with European Debt woes. Friday’s activity we may be able to attribute to some short covering ahead of the nth hemisphere long weekend.

We have a considerable amount of data out this week including from the states –manufacturing, housing and of course the employment data with the greatly anticipated Non-Farm payrolls on Friday which are expected to show 508,000 new jobs created in May, against a previous 290,000. The unemployment rate is likely to edge down to 9.8 percent. Locally we have building approvals expected to contract 5 percent in April, Retail Sales which are expected to grow 0.3 percent in April. And most importantly RBA interest rate decision on Tuesday – we expect the RBA to sit on their hands with the cash rate to remain at 4.5 percent. As of Friday the market is factoring in a 14% chance of a rate hike Tuesday.