Daily forex forecast - 03/5/2010

Monday, 3 May 2010 - Market Commentary

:: Australian Dollar: The Australian Dollar opens?the new week lower against a stronger greenback at 0.9225 after a steady local session last Friday. The unit traded briefly above the US93-cent mark after a positive lead from the region's equity markets. However, the local unit has been unable to consolidate upon any gains over this level and another bout of profit-taking saw a move back down to 0.9240 during the New York time zone.?The Aussie is likely to remain?underpinned however by strong prices for commodities and our?yield advantage.

- We expect a range today in the AUD/USD rate of 0.9180 to 0.9255

:: Great Britain Pound: Pound Sterling spent most of Friday on the back foot?on economic growth concerns. The pound opens at 1.5340 today against a stronger greenback after data on Friday showed the U.S. economy grew at 3.2 per cent in the first quarter compared to the U.K. which last week revealed its economy grew at just 0.2 per cent annual pace. Budget deficit?worries are also hindering the currency at the moment. Meanwhile, the pound opens higher against the Australian Dollar (1.6580) and weaker against the New Zealand Dollar (2.1090).

- We expect a range today in the GBP/AUD rate of 1.6520 to 1.6610

:: New Zealand Dollar: Despite a?brief rally above USD73 cents on Friday night, the New Zealand Dollar?opens the new week at 0.7250. The kiwi spent most of?the latter part of last week consolidating in the mid-72s as debate continued amongst investors as to when the Reserve Bank of New Zealand will next move on interest rates. The RBNZ said last Thursday that policy stimulus is expected to be removed in the coming months.?Meanwhile, the kiwi has picked up a small amount of ground on the Australian Dollar and opens today at 0.7855.

- We expect a range today in the NZD/USD rate of 0.7240 to 0.7300

:: Majors: The Euro opens higher on Monday at 1.3340 after Euro region finance ministers agreed to a EUR110mio bailout package for Greece. In return for the three-year financial lifeline, Greece has agreed to dramatically cut its budget deficit from 14 per cent of GDP to 3 per cent of GDP by 2014. Meanwhile, the greenback opens steady against the Japanese Yen at 93.70 after data on Friday showed the U.S. economy grew at 3.2 per cent annual pace. The data was slightly below market expectations and, with employment showing only tentative signs of improvement, backs up last weeks statement by the U.S. Federal Reserve that rates will remain near zero for an extended period.

:: Data Releases: