AUD maintains recent range

Australian Dollar:

The Australian dollar did a relatively good job last week shrugging off a handful of significant data releases, releases which in hindsight promised to threaten the value of Australia’s currency. Having once again struggled to keep its head up above the crucial 94 US Cents level disappointing Chinese export figures were countered later in the week by signs of an improving domestic labour market. Trading in a narrow band of 0.9340 – 0.9455 when valued against its US Counterpart over the past 5 days the Australian dollar opens this morning lower at the familiar rate of 0.9380. Of critical importance this week investors will be keeping a close on The Reserve Bank minutes from July waiting to see whether Glenn Steven’s language is in line with his wishes for a lower currency heard last week.   

• We expect a range today of 0.9350 – 0.9410

New Zealand Dollar:

Having risen from a low of 0.8710 when valued against its US Counterpart last week the New Zealand dollar opens this morning just above the 88 US Cents mark.  In what’s shaping up as a busy week packed full of key risk events the New Zealand dollars first hurdle will come on Wednesday given the expected release of second-quarter inflation figures. If the Consumer Price Index is to have risen by 0.4 percent as expected that would be sufficient enough for existing expectations surrounding future interest rate rises to remain intact hence providing additional support to an already strong Kiwi.

• We expect a range today of 0.8780 – 0.8840

Great British Pound:

The Great British Pound traded in a tight range of 1.7098 – 1.7149 when valued against its US Counterpart on Friday a range indicative of the thin economic docket witnessed across the UK. With the Sterling stable for the time being the focus this morning appears to be on what lies ahead with CPI figures due for release on Tuesday evening followed by Janet Yellens semi-annual testimony to congress on Wednesday evening. Around 0.2 percent lower against the Greenback this morning at 1.7113 the Sterling is marginally stronger against both the Australian dollar (1.8249) and the New Zealand dollar (1.9415).   

• We expect a range today of 1.8200 – 1.8280

Majors:

Highlighting that European debt markets still remain a relatively fragile place, The S&P 500 Index completed its worst week since April amid signs of financial stress in Portugal. Triggering broader moves away from riskier assets missed debt payments by a company linked to Portugal’s second-largest lender acted as the catalyst for a move back into safe haven currencies like the Japanese Yen. Stronger against the Greenback this morning at 101.346 the Euro is steady at a rate of 1.3604. Taking a look at what lies ahead minutes from the Federal Reserve’s June meeting will be released on Wednesday following their July 9 meeting where Policy makers agreed to end asset purchases by October whilst also promising continued support if financial conditions fail to improve.  

Data releases

• AUD: No data today
• NZD: No data today
• JPY: Revised Industrial Production m/m
• GBP: BRC Retail Sales monitor y/y
• EUR: ECB President Mario Draghi Speaks
• USD: No data today