AUD remains firm above 92 US Cents

Australian Dollar:

Following the aggressive mid-week sell off which equated to 1 US Cents worth of losses for the Australian dollar when valued against its US Counterpart, the higher yielding asset did well during the back half of the week to steady itself trading in very tight range of (0.9212 – 0.9248) on Friday. Whilst the path of least resistance in the medium-term appears down for the Australian dollar for time being some solid support can be seen at 0.9220 followed by 0.9170. In the absence of a dramatic rally occurring this week the Australian dollar remains poised to experience its first monthly drop since January with the economic calendar over the coming days looking very thin. In a familiar position this morning the Aussie buys 92.34 US Cents

• We expect a range today of 0.9200 – 0.9270

New Zealand Dollar:

Whilst still circulating close to the 0.8550 mark at the beginning of the new week when valued against its US Counterpart, overall the New Zealand dollar has struggled to find many buyers of late given the sharp fall witnessed across key commodities. Providing a further reason to sell the higher yielding asset on Friday positive US data flows have triggered a notable move back into US dollar dominated assets. 0.2 percent lower this morning at a rate of 0.8540 concerns over commodity prices and what that means for China’s economic outlook threatens to weigh on the Kiwi at the start of the new week.

• We expect a range today of 0.8510 – 0.8570

Great British Pound:

During a session dominated by a stronger US dollar the Great British Pound struggled to keep pace with the worlds reserve currency late last week falling from earlier highs of 1.6874 down to a low of 1.6811. In the absence of any domestic data flows, new home sales data in the United States acted as the main catalyst for a stronger Greenback a move which affected almost every major currency pair. Lower this morning at 1.6827 the Sterling is also weaker against the Aussie (1.8221) whilst stronger against the Kiwi (1.9699)

• We expect a range today of 1.8190 – 1.8250

Majors:

It was a one street for the 23-nation Euro on Friday, down with investors steering clear of the shared unit after a disappointing report on German business sentiment further enhanced the view that the European Central Bank will cut rates when they meet next month. It what’s been a tumultuous month for the Euro it has now accumulated losses in excess of 3 US Cents amid concerns not enough is being down to tackle ongoing deflationary fears. Weaker this morning at a rate of 1.3619 a stronger US dollar has also contributed to its weakness. In other currency moves positive housing numbers across the United States sees the Greenback stronger against the Yen this morning at 101.958. Looking ahead over the coming days speeches from ECB President Mario Draghi and BOJ Governor Kuroda remain the highlight on an otherwise slim economic docket.  

Data releases

• AUD: No data today
• NZD: No data today
• JPY: Monetary Policy Meeting Minutes  
• GBP: Bank Holiday
• EUR: ECB President Mario Draghi Speaks
• USD: Bank Holiday