Daily Forecast - 6/3/2010

:: Australian Dollar: The Aussie dollar opens this morning slightly above the 92 cent level buoyed by optimism of a continued recovery in global economic growth following upbeat U.S economic data in the form of increasing employment. Local markets are eyeing today's RBA meeting with an expectation of another interest rate rise keeping it well bid in early morning trade. Resistance at around 0.9250 remains critical for the Australian dollar with a rise in rates likely to see this level tested in Asia today.

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

:: Great Britain Pound: The Pound Sterling opens in Asia this morning just shy of 1.5300 against the Greenback after having had exchanged as high as 1.5320 over the Easter long weekend. With positive signs emerging in the U.S and a better than expected Manufacturing PMI result the GBP/USD has once again found favour ahead of this week's Bank of England meeting. Gains in the Aussie dollar offset the higher Pound with the GBP/AUD cross rate opening this morning at 1.6585.

- We expect a range today in the GBP/AUD rate of 1.6500 to 1.6650

:: New Zealand Dollar: The Kiwi failed to break back above the 71 cent mark late last week despite several attempts following the less than impressive business confidence index released mid week. An increase in risk appetite following the U.S nonfarm payroll data triggered a bounce from 0.7020 however the move ran out of momentum around 0.7050 and the NZD/USD opens this morning at 0.7035. A surge in demand for the AUD/NZD sees it open higher this morning near 1.3100 with the Australian central bank rate decision today likely to see another swift move on the cross.

- We expect a range today in the NZD/USD rate of 0.6985 to 0.7075

:: Majors: The U.S dollar continued its recent uptrend to trade at 94.75 against the Japanese Yen, its highest level since August 2009 despite the release of an upbeat Tankan business survey late last week. Adding momentum to the big dollar was strong U.S economic data with the non farm sector with payrolls adding 162k jobs in March and large increases in the ISM manufacturing index. Gains in the Greenback kept a lid on attempts of a rally on EUR/USD which exchanged between 1.3460 and 1.3540 over the Easter holiday period. The week ahead will continue to see volatility in currency markets with particular interest in Wednesday's Bank of Japan interest rate decision and the accompanying rhetoric whilst mainland Europe eyes the release of GDP and Retail Sales with the main attraction being its own central bank meeting on Thursday.

:: Data Releases: