Australian Dollar Outlook - 14 February 2013

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Bell FX Currency Outlook: Australian Dollar bounces to two week high.

Australia: The Australian dollar has risen to a two week high overnight consolidating yesterday's gains as improved consumer sentiment and a lift in metal prices buoyed the currency.

The local unit traded to a high of 1.0360 overnight against the Greenback; up from 1.0330 seen yesterday. Domestic consumer confidence figures rose again for the fifth time in six months yesterday by 7.7% giving the AUD a further kick higher.

Markets expectations for a March 5th rate cut have pared back to 40%. In a relatively lacklustre session, the main focus for markets last night was the Bank of England's latest Inflation Report.

The pound was sharply lower against most currencies seeing the AUDGBP surge higher. Today will see domestic inflation expectations released at 11:00am.

The Bank of Japan also meets today but there is little expectation for any major policy changes

Majors: It was a mixed session for equity markets as European equities edged higher but US stock posted a modest fall in light volume. US Retail sales were disappointing in January with core sales weaker than expected at 0.2% m/m.

However, there were solid upward revisions to the November and December figures. US treasuries sold off after the Retail Sales read with equities also finishing lower.

The S&P 500 fell 0.1% to 1,518 while the DJIA fell 0.4% to 13,961. Higher Eurozone December Industrial Production data saw European equities higher with the German DAX rising 0.7% to 7,712 and the FTSE closing 0.3% higher at 6,359.

Thin trade saw spot gold prices decline 0.6% to close at USD 1,642.1 per ounce. Metals and commodities were mixed with aluminium posting 1.1% gain.

Oil prices were also mixed with WTI futures closing 0.6% lower at USD 97.0 per barrel, while Brent rose 0.1% to USD 117.8 per barrel.

Tonight the G20 Finance Ministers and Central Bank Governors meeting gets underway in Moscow. Data wise tonight, Eurozone GDP data is due along with US unemployment ClaimsEconomic Calendar14 FEB AU Feb Westpac -MI Consumer InflationJP Q4 GDP annualisedEU Q4 GDPUS Initial Jobless claims w/e 10/2For latest pricing, ranges, visit

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