:: Australian Dollar: The Aussie dollar followed the local equity market higher during yesterdays early morning session peaking above the 84 cent mark heading into the release of July New Motor Vehicle Sales which was expected to be a non event. However the 6.9% fall caught the market by surprise, as many expected a positive figure, putting a dent in the stride of the AUD/USD rate. Throughout the afternoon the Aussie drifted lower at a slow rate before finding a bottom ahead of 0.8350 in early London exchange. A brief rally in the Euro led the Australian dollar higher, eventually peaking around 0.8425 before a settling back at 0.8380 for the majority of the U.S session. It appears the AUD/USD is experiencing a period of consolidation lacking any true direction which is to be expected after such a sustained run higher. Consequently it appears unlikely the recent 0.8180 to 0.8475 range will be broken in the very short term.

- We expect a range today in the AUD/USD rate of 0.8325 to 0.8410

:: Great Britain Pound: The Pound Sterling continued to lose upside momentum overnight as traders remain cautious on the prospects for the UK economy. The GBP drifted lower against the both the Greenback and Euro sliding to a low of 1.6390 and 0.8725 respectively. Better than expected European economic data and a flat U.S equity market were the main reasons for the fallout in the Pound which also spilled over to the GBP/AUD cross rate. The cross broke below its 14th of August low of 1.9580 to exchange within a whisker of 1.9500 overnight as the Aussie dollar held ground against the Greenback. The prospects for the cross continue to appear bleak with little in the way of inspiration for a recovery at present.

- We expect a range today in the GBP/AUD rate of 1.9485 to 1.9625

:: New Zealand Dollar: The Kiwi continued its stellar run higher overnight trading to an eleven month high of 0.6885 before sliding back to this morning's open at 0.6850. Despite the New Zealand economy's poor economic fundamentals and sluggish outlook the NZD dollar continues to defy naysayers, strengthening against the Greenback and a basket of other currencies as well. Today's RBNZ two year inflation expectation may be the catalyst to move the NZD back below the 68 cent mark, which if breached is likely to open the door for a relatively swift move towards technical support around 0.6750. With equity markets in North America finishing flat the more likely scenario however remains for a subdued trading day ahead.

- We expect a range today in the NZD/USD rate of 0.6820 to 0.6870

:: Majors: Currency markets remained relatively subdued overnight with the big dollar tracking sideways against the other major currencies. In economic data released Euro-zone industrial new orders rose a much larger than expected 3.1% in June to post its biggest gains since November 2007. EUR/USD bounced from 1.4285 to an overnight high of 1.4340 following the announcement only to pull back in U.S trade and finish the offshore session back around 1.4300. With equity markets in North America finishing relatively flat USD/JPY opens this morning marginally lower than the Asian close of 94.90 at 94.55. One of the big movers overnight was the Canadian dollar which strengthened considerably against its southern neighbour moving from 1.0820 to 1.0725 following a much higher than expected reading in June Retail Sales. Analysts had been expecting consumer spending to increase just 0.1% however the 1% rise caught the market by surprise increasing demand for the CAD.

:: Data Releases:

* AUD: No Data Expected today
* NZD: RBNZ Two Year Inflation Expectation
* USD: Aug Consumer Confidence, Jun House Price Index & Jun S&P/Case-Shiller Home Price Index
* GBP: Jul BBA Loans for House Purchase
* EUR: Q2 German GDP forecast, Q2 German Private Consumption & Q2 German Construction Investment
* JPY: Jul Merchandise Trade Balance
* CAD: No Data Expected today