:: Australian Dollar: Yesterday's knee jerk reaction to a hung parliament saw the Aussie initially tumble almost a cent from Friday's close to exchange around 0.8850 in early Monday morning trade. The Australian Dollar recouped its post-election losses climbing to 0.8980 against the US Dollar offshore as the election results were digested. Traders bet the political stalemate will result in a coalition government which will postpone or reduce the widely unpopular proposed mining tax. The Australian Dollar opens today buying 0.8911 US following dovish sentiment from the US and a drop in oil prices.

- We expect a range today in the AUD/USD rate of 0.8850 to 0.8950

:: Great Britain Pound: The Pound lay flat during Asia sitting snuggly between 1.5550 -1.5570 versus the Greenback before breaching 1.5600 late in the session. Moving offshore surveys by Markit Economics Ltd. and YouGov Plc found consumer finances remained downbeat while Grant Thornton and the Institute of Chartered Accountancy in England and Wales said business confidence fell in the third quarter as Prime Minister David Cameron's budget cuts begin to curb economic growth. The lagging prospects for growth continued, dragging the Sterling back towards 1.5500 US. This morning the Pound open's at 1.7410 AUD and 2.1950 against the Kiwi.

- We expect a range today in the GBP/AUD rate of 1.7320 to 1.7480

:: New Zealand Dollar: The Kiwi remained between 0.7060-7070 US for most of the Asian session yesterday. Offshore the Kiwi initially dipped to 0.7040 against the US Dollar before regaining its strength to break 0.7100 US. Nervous investors pared back Kiwi gains with the dubious political situation in Australia expected to persist for a few weeks. The Kiwi consolidated above the 0.7050 level against the Greenback after posting the biggest weekly decline since May 16th opening this morning buying 70.60 US cents.

- We expect a range today in the NZD/USD rate of 0.7025 to 0.7085

:: Majors: Flash manufacturing and services PMI from Europe over night were a mixed bag. Euro Zone Flash Services hit the mark at 55.6 supported by an unexpected gain of 58.5 from German services PMI. Meanwhile Flash manufacturing declined to 55 from 56.7; however it did remain above the 50 level which determines the bullish or bearish sentiment. The Euro traded tightly between 1.2690-1.2720 USD spending most of the European session above 1.2700 before dipping below 1.2650 as investors remained skittish about the prospects for the U.S economy.

:: Data Releases:

  • AUD: No Data Expected Today
  • NZD: Q3 Inflation Expectations
  • USD: Jul Existing Home Sales & Aug Richmond Fed Manufacturing Index
  • GBP: Jul BBA Loans for House Purchases
  • EUR: Q2 German Final GDP & Jun Euro-zone Industrial Orders
  • JPY: No Data Expected Today