Australian Dollar: The Aussie dollar continued to press higher in Asia yesterday trading marginally above the 93 cent handle following the release of the RBA board minutes with the central bank continuing to send the same bullish signals on interest rates. Support for the high yielding AUD continued throughout European trade with buyers lining up ahead of 0.9250 that was until North American investors entered. Disappointing housing data out of the U.S triggered a flight back into the Greenback and subsequently pushed AUD/USD below 92 cents before bouncing back slightly to open this morning around 0.9220 ahead of today's Australian New Motor Vehicle Sales and Leading Index data releases.

- We expect a range today in the AUD/USD rate of 0.9175 to 0.9275

Great Britain Pound: The Pound Sterling oscillated between 1.6445 and 1.6355 in early London following mixed U.K public finance data. Whilst public sector net borrowing declined more than expected in September the headline figure saw the UK government finance a larger than predicted amount which has a negative impact as it widens the budget deficit. Nevertheless the GBP/USD eventually broke through technical resistance at 1.6450 to momentarily trade near 1.6500 during U.S trade before dipping back to finish at 1.6370 in NY. The market will be looking ahead to tonight's release of the Bank of England minutes for clues on the asset purchasing program which has been the main lever behind the recent strengthening in the Cable. Should the central bank continue to back the program in its current form or hint at increasing the size then it is likely the longer term downtrend will resume. A softer Aussie dollar coupled with the firmness in the Pound saw the GBP/AUD cross rat e rally from 1.7650 to 1.7840 overnight before pulling back to open this morning around 1.7730.

- We expect a range today in the GBP/AUD rate of 1.7680 to 1.7850

New Zealand Dollar: The rally in the Aussie dollar to 93 cents added to upside momentum on the Kiwi yesterday as it pushed to an intraday high near 0.7575. Support at 0.7520 held during European trade however the tide turned aggressively following disappointing U.S economic data. Economists had been expecting a vast improvement in Housing Starts and Building Permits out of the U.S in September with only marginal increases weighing on risk appetite. The Kiwi went crashing below 75 cents eventually finding some support below 0.7450 to bounce back to this morning's open just shy of the 75 cent handle.

- We expect a range today in the NZD/USD rate of 0.7425 to 0.7525

Majors: The Euro seemed unperturbed by a larger than expected fall in German Producer Prices holding onto a steady range between 1.4955 and 1.4985 in European trade. The volatility increased however during the North American time-zone with lower than forecast U.S housing data heightening risk aversion and consequently demand for the Greenback. Economists had been expecting September Housing starts and Building Permits to increase to 610k and 595k respectively however the softer than expected 590k and 573k results stoked some fear the recovery may be even slower than previously anticipated. The big dollar eventually strengthened to 1.4880 against the Euro and 91.08 Japanese Yen following the announcements. In other U.S economic news wholesale prices as measured by the PPI also disappointed the market falling 0.6% against predictions of a relatively flat September, a sign of subdued inflation.

Data Releases:

  • AUD: Sep New Motor Vehicle Sales & Aug Westpac Leading index
  • NZD: Sep Visitor Arrivals & Sep Credit Card Spending
  • USD: Beige Book & Fedspeak
  • GBP: BoE minutes & CBI Quarterly Industrial Trends
  • EUR: No Data Expected
  • JPY: No Data Expected
  • CAD: No Data Expected

Note: The above exchange rates are based on interbank rates. If you are considering a transfer then please login, register or call us for a live dealing rate.

United kingdom New York