Offshore public holidays stifle price action

Australian Dollar:

Indicative of broader market sentiment investors appeared reluctant to pick up the Australian dollar yesterday in what proved to be an extremely uneventful start to the new week. Ranging between a low of 0.9229 and a high of 0.9248 when valued against its US Counterpart a lack of domestic flows mixed with a US public holiday kept volumes low and recent ranges intact. With US core durable goods orders being the pick of the economic calendar this evening the Australian dollar appears poised to remain solid up above the 92 US Cents level for now opening this morning virtually unchanged at a rate of 0.9236   

• We expect a range today of 0.9210 – 0.9260

New Zealand Dollar:

The New Zealand dollar has done next to nothing when valued against its US Counterpart over the past 24 hours with broader currency markets struggling for liquidity given the extended long weekend across the United States. In figures released locally yesterday morning New Zealand’s trade surplus narrowed more than expected in April as exports (dairy and meat products) fell more than imports. Having only a limited influence on the Kiwi the New Zealand dollar has recovered from an earlier low of 0.8525 opening 0.1 percent stronger at a rate of 0.8544  

• We expect a range today of 0.8520 – 0.8570

Great British Pound:

As was the case with most major pairs overnight a local public holiday has seen the majority investors sit on their hands over the past 24 hours. In a subdued session the Great British Pound floated between a low of 1.6825 and a high of 1.6852 when valued against its US Counterpart a range indicative of just how little price-action eventuated. With most investors keeping a close eye on comments from the ECB looking ahead this week underlying movements are set to be dictated by US GDP as well as a string of housing prints from the world’s largest economy. Opening virtually unchanged against both the Greenback (1.6839) and the Aussie (1.8225) the Sterling is lower against the Kiwi (1.9668).

• We expect a range today of 1.8200 – 1.8260

Majors:

Given both the United States and United Kingdom remained closed overnight investors got just what was expected, a quiet session. With volumes across the board lower, there were no volatility flare ups nor any surprise movements. In a statement which stole the show overnight however European Central Bank President Mario Draghi signalled policy makers are ready to take action in June should they see low inflation becoming entrenched. Whilst Mr Draghi didn’t shed any further light on the possible measures which may be taken, an interest rate cut accompanied by a liquidity injection are much likely than a full scale US Fed Style quantitative easing program. Helping the Euro gain some traction the shared unit opens this morning 0.3 percent stronger at a rate of 1.3644. In other moves the greenback is steady against the Yen at 101.922.

Data releases

• AUD: No data today
• NZD: No data today
• JPY: CSPI y/y
• GBP: BBA Mortgage Approvals
• EUR: No data today
• USD: Core Durable Goods Orders m/m, Durable Goods Orders m/m