Daily Commentary - 21/09/2009

:: Australian Dollar: The Aussie dollar bounced between 0.8650 and 0.8715 during Friday's offshore session weighed down by profit taking on the Euro to open this morning at 0.8670. Following a week that saw the local unit approach the 88 cent mark offshore investors trimmed back expectations of further gains in the short term. Today sees the release of Australian second quarter wage agreements which will be an important indicator for supply side inflation while August New Motor Vehicle sales are also likely to grab some headlines.

- We expect a range today in the AUD/USD rate of 0.8620 to 0.8700

:: Great Britain Pound: After holding onto 1.6300 against the Greenback during European trade the Pound Sterling bounced back slightly to retest 1.6400 prior to the U.S open. Resistance prevailed however as investors remained cautious about the prospects for the U.K economy following a week of softer than expected economic data, selling GBP/USD back down. Rumoured stop loss selling sees the GBP opening lower this morning with early exchange at 1.6215 and 1.8715 against the U.S and Australian dollars respectively.

- We expect a range today in the GBP/AUD rate of 1.8680 to 1.8780

:: New Zealand Dollar: In what must come as some relief to New Zealand central bank and Treasury officials the Kiwi dollar halted its recent run on Friday pulling back from above 71 cents to open this morning under some selling pressure at 0.7075. With no U.S economic data of note released on Friday sentiment turned bullish on the Greenback in early Monday trade following some relatively upbeat comments by the U.S president over the weekend. This week sees some important economic releases out of N.Z beginning with today's Performance of Services Index.

- We expect a range today in the NZD/USD rate of 0.7035 to 0.7120

:: Majors: Despite some positive economic data out of Europe on Friday the Euro opens this morning relatively unchanged at 1.4700 against the Greenback. German Producer Prices increased for the first time in almost a year whilst the Euro-zone Current Account turned from deficit to surplus. With no U.S economic data released the big dollar pulled back from an early rally to 1.4645 against the Euro despite it holding up against the Yen to open this morning near its highs at 91.30. Comments by U.S President Obama in an interview with CNN that despite persistently high unemployment levels; All the signs are that the economy's going to start growing again has given early Asian investors some confidence in the Greenback. Looking ahead this week the markets' attention will no doubt focus on Wednesday when the U.S Federal Reserve bank meets. With interest rates expected to remain on hold investors will look for more direction on the economy and the central banks stimulus measures.

:: Data Releases: