Australian dollar steady ahead of RBA

Australian Dollar:

The Australian dollar failed to react yesterday after figures showed Australian retail sales had grown by 0.6 percent in June, its biggest monthly jump since January. Demonstrating that consumer spending remains solid the negative mood across global equities over the past 24 hours has kept any potential buying opportunities at bay. Given today’s monetary policy statement from the Reserve Bank, prevailing expectations that the US Fed will raise rates as early as quarter one next year this has seen investors more attuned to broader interest rate moves ahead of any local data prints. Marginally stronger this morning the Australian dollar currently buys 93.32 US Cent.

We expect a range today of 0.9300 – 0.9360

New Zealand Dollar:

The New Zealand dollar has recovered somewhat over the past 24 hours managing to lift itself back up above the psychological support level of 85 US Cents in what has been a relatively quiet start to the week. Reaching an overnight high of 0.8526 when valued against its US Counterpart looming central bank meetings, employment figures tomorrow as well as new data on dairy prices will likely be key drivers of the currency over the coming days. Following a depreciation of more than 3 percent since the beginning of July weaker commodity prices as well comments from RBNZ Governor that the currency’s strength was unjustified have all contributed to the Kiwi’s demise. 25 basis points stronger upon open the Kiwi currently swaps hands at a rate of 0.8521.

We expect a range today of 0.8490 – 0.8560

Great British Pound:

Acting as a driver behind the Sterling’s strength overnight house building across the UK accelerated last month at the fasted rate since November 2003. Helping create jobs, construction grew for its 15th consecutive month with the construction PMI reading of 62.4 comfortably surpassing the expected number of 62.1. In what’s shaping up as a busy week for the Great British Pound Services PMI figures tonight followed by the Bank of England’s interest rate decision on Thursday both loom as potential market movers. Notably stronger against the US Dollar this morning the Sterling currently trades at a rate of 1.6863.

We expect a range today of 1.8030 – 1.8090

Majors:

US Stocks have rebounded from their biggest weekly loss in two years overnight after Portugal announced a bailout for one of its largest lenders whilst a handful of earnings beat estimate. With markets also receiving a slight reprieve from geopolitical concerns overnight overall it has been an uneventful start to the week a position furthered also by a lack of data. In taking a look at what lies ahead attention will no doubt turn to the European Central Bank later in the week who remain under pressure to deliver additional stimulus in the face of a dented economic recovery weighed down by deflationary fears. In currency moves the Euro opens this morning virtually unchanged against the greenback at a rate of 1.3421 whilst the Yen also opens at a familiar level of 102.552