Employment gains trigger rally

Australian Dollar:

The Australian dollar rallied strongly yesterday in response to a monthly employment report which showed some 37 500 new jobs were added to the labour pool during the month of March. Comfortably surpassing the anticipated number of 15 000, the latest result painted an overall positive picture of employment conditions with the official unemployment rate falling to 6.1 percent. Reaching an overnight high of 0.7822 when valued against its US Counterpart the Greenback has remained largely on the sidelines over the past 24 hours. Opening this morning more than a full cent stronger at a rate of 0.7802 recent profit taking moves suggest the Australian dollar’s upside from existing levels may well be limited.

• We expect a range today of 0.7750 – 0.7850

New Zealand Dollar:

In the wake of a slew of poor economic results from the world’s largest economy overnight the New Zealand dollar has benefitted significantly from a weaker US dollar. Given US policy makers have once again failed to narrow forecasts which surround the timing of their first interest rate hike the worlds reserve currency as a result has struggled to maintain its value this week. Pushing comfortably through the 76 US Cents barrier yesterday the New Zealand reached an overnight of 0.7697 when valued against its US Counterpart opening stronger this morning at a rate of 0.7673. In the absence of any local data flows today investors will be looking towards CPI and consumer sentiment results from the US this evening for direction.

• We expect a range today of 0.7630 – 0.7720

Great British Pound:

In what’s become a familiar theme this week the value of the Great British Pound has once again been bolstered overnight on the back of softer macro indicators flowing from the US economy. Emphasising it remains a story of relativity a thin domestic docket mixed with poor offshore performance has combined well for the Sterling which opens notably stronger when valued against its US Counterpart at a rate of 1.4934. In other moves the Great British Pound is weaker against a notably stronger New Zealand dollar (1.9453) and Australian dollar (1.9133).

• We expect a range today of 1.9050 – 1.9200

Majors:

US Stocks have retreated overnight with lingering concerns over approaching corporate earnings keeping investors temporarily sidelined. During a week once again dominated by US Federal Reserve chatter Vice Chair Stanley Fisher emphasised overnight that data would play a determining role when deciding the exact timing of a rate hike, failing to provide any further clarity. On the data front, weekly unemployment claims, building permits and housing starts all failed to reach expectation overnight with the overriding picture showing that the US housing markets contribution to growth during the first quarter was close to zero. Triggering across the board declines for the worlds reserve currency the US dollar is weaker against both the Japanese Yen (118.988) and the Euro (1.0761). Looking ahead this evening mounting concerns over Greece’s lack of progress in reaching a debt agreement will continue to play its part as will data on US Inflation and consumer sentiment.  

Data releases

• AUD: No data today
• NZD: No data today
• JPY: No data today
• GBP: Claimant Count Change, Average Earnings Index 3m/y
• EUR: Final CPI y/y
• USD: CPI m/m, Prelim Consumer Sentiment