Australia: The Australian Dollar was sold off two US Cents towards 0.8200 overnight and has subsequently traded below 0.8200 following reports out of Europe regarding Europe’s debt crisis, which may have spread to Hungary. The Hungarian Prime Minister said the nation’s economy was in a “grave” situation but the government was ready to avoid a crisis similar to Greece. Following this, weaker than expected US job numbers Friday night dampened markets hopes for global economic prospects, and demand for growth assets and commodities slumped accordingly when US non farm payrolls confirmed the economy had created fewer jobs than expected. This led investors to once again question the pace of the global economic recovery, and driving a push towards “safe haven” assets. The AUD is expected to get most of its direction today from equity markets, which are expected to be lower on the back of US trading Friday night which saw the Dow off 3.20%. There is a huge amount still happening in world markets, hence volatility is absolutely with us to stay on the AUD with next major support on the downsode at 0.8070. Economic events today include the Australian Industry Group/Housing Industry Association’s performance of construction index and the ANZ job advertisements series, both for the month of May.

Majors: The EUR dropped to its lowest level in more than four years Friday night, as disappointing job reports combined with fears the euro-zone sovereign debt crisis is spreading across the region, led investors away from risk. The EUR fell below the key $1.20 level on worries Hungary would be the next country to fall victim to a debt crisis, joining the fiscally stressed euro-zone countries such as Spain and Portugal. Worse than expected US jobs data didn’t help sentiment. The US economy added only 431k jobs in May, below the market median forecast of 536k jobs. The Dow Jones didn’t take the news well, closing 3.15% lower, while the S&P 500 closed 3.44% lower. While problems in Europe have taken the spotlight recently, Friday’s US jobs report does highlight that the US may have some bumps in the road on their way to recovery. China will also be watched closely to see whether they can successfully cool their overheating economy with out a slump in growth.