Australian Dollar: In minutes released from The Reserve Bank of Australia’s February policy meeting, markets effectively lengthened the odds of a near-term interest rate cut whilst longer-term maintaining the easing bias for the benchmark rate which currently sits at 3 percent. Leading to a firmer dollar the domestic currency traded higher for much of yesterday’s session topping out at a rate of 1.0366 against its US Counterpart. With positive sentiment throughout Europe also adding to demand the Aussie dollar opens on the right side of the 1.0350 mark this morning, currently swapping hands at 1.0354. On the outlook today there are several tier 2 data releases likely to influence the short-term direction of the Aussie however in general the medium term ban of 1.0250 – 1.0350 isn’t expected to be broken by too greater an amount.
We expect a range today of 1.0320 – 1.0380
New Zealand Dollar In what has been an encouraging 24 hour window for the New Zealand dollar a strong global dairy trade auction added to the positive sentiment currently surrounding the local economy yesterday. Taking the New Zealand dollar to an overnight high of 0.8488 against its US Counterpart a strong Investors confidence reading from Germany as well a sustained rally in Wall Street also helped the prospects of the higher yielding asset. With some stiff resistance being seen around the 85 US Cents mark investors will await a speech to manufacturers and exporters today from RBNZ Governor Graeme Wheeler before deciding on short-term direction. Meanwhile this morning the Kiwi opens stronger currently buying 84.80 US Cents
We expect a range today of 0.8440 -0.8510
Great British Pound: The Great British Pound has once again come under some distinct selling pressure over the course of the past 24 hours. Despite a handful of major currencies which were able to move in the right direction overnight investors remain extremely cautious leading into this evening given the expected release of the BOE’s Monetary Policy Committee minutes as well as domestic unemployment figures. Given the importance of both these announcements the Sterling is likely to remain subdued during the Asian session today as it opens around half a cent weaker this morning at 1.5422. Meanwhile when compared against the Aussie (1.4887) and the Kiwi (1.8181), the picture only looks bleaker.
We expect a range today of 1.4860 – 1.4920
Majors: Global equities continued their rich vein of form overnight with the S&P 500 rallying to its highest level in five years. Increasing by 0.6%, the rally across equity markets was triggered by a strong German Investor confidence index which jumped to its highest level in almost three years for the month of February. Adding to signs that economic activity in Europe’s flagship economy is slowly starting to rebound the news helped the prospects of the Shared Unit which also rallied as a result. Touching highs of 1.3394 against its US Counterpart the Euro opens stronger this morning, close to this level at 1.3388. In the other notable moves overnight the Japanese Yen also rallied following two days worth of losses after Finance Minister Taro Aso said he was not considering foreign bond purchases as part of an effort to ease Monetary and Fiscal Policy. Contradicting comments made earlier in the week by Prime Minister Shinzo Abe that such policy options remain a possibility there has been a very clear and very public disagreement on Policy measures. Trading to 24 hour low of 93.282 the USD/JPY opens notably weaker this morning at 93.48.
AUD: CB Leading Index m/m, Wage Price Index q/q
NZD: PPI Input q/q, RBNZ Gov Wheeler Speaks
JPY: All Industries Activity m/m
GBP: Claimant Count Change, MPC Meeting Minutes, Unemployment Rate, Average Earnings Index 3m/y
EUR: German PPI m/m, French CPI m/m, German 10-yr Bond Auction, Consumer Confidence
USD: Building Permits, PPI m/m