:: Australian Dollar: The Aussie dollar followed local equity markets lower in early trade yesterday to test critical technical support ahead of 0.7450. Demand held firm however and the AUD spent the remainder of the Asian session clawing its way back above the 75 cent mark to enter offshore exchange at 0.7510. European investors continued the theme following bullish comments from the IMF and with a rebound on U.S equities the AUD/USD traded above 76 cents to open this morning at 0.7640. Asian investors will have plenty to digest today with both the RBA Governor and Treasury Secretary speaking and the minutes from the May meeting also scheduled for release all of which is likely to provide some underlying support for the AUD.

- We expect a range today in the AUD/USD rate of 0.7590 to 0.7690

:: Great Britain Pound: The Cable received a boost in early London trade with U.K property website Rightmove announcing the fourth consecutive monthly increase in house prices during the month of May as measured in their monthly survey. Investors sent the GBP up from around 1.5150 to an eventual late New York high near 1.5350 with positive risk sentiment emanating throughout the U.S session. The GBP/AUD cross rate fell from its perch near 2.0300 to open this morning marginally above the psychological 2 level at 2.0050 following a big rally in the Aussie dollar.

- We expect a range today in the GBP/AUD rate of 1.9940 to 2.0120

:: New Zealand Dollar: The Kiwi dollar took a hit in early trade yesterday following worse than expected PPI data. Producer prices in the region fell from both an input and output perspective during the first quarter of 2009 with the -2.5% and -1.4% results both coming in below economist forecasts for a flat result. However after reaching a bottom at 0.5830 in Asia the NZD then began a fight back that continued throughout the evening as risk appetite returned. Better than expected U.S housing data and bullish comments from IMF deputy MD Lipsky boosted the markets confidence and as such the relatively high yielding Kiwi dollar posted an eventual high marginally above 0.5950 to open this morning at 0.5940.

- We expect a range today in the NZD/USD rate of 0.5910 to 0.5985

:: Majors: Consumer Sentiment in Japan, as measured by the government’s cabinet office consumer confidence survey, improved in April for the fourth consecutive month rising by more than expected from 29.6 to 33.2 giving the Yen some extra support in local trade yesterday. With USD/JPY trading within a whisker of 94.50 following the announcement late Asia reversed the trend to take the big dollar higher as risk appetite rebounded once again. Offshore markets took EUR/JPY higher after IMF deputy Managing Director John Lipsky said “Our world economic outlook anticipates a return to global expansion by next year” sending EUR/JPY up over 2% from the Asian close of 127.80 to post an eventual overnight high of 130.65. Adding to demand for the Euro was a surprise swing into a trade surplus for the Euro-zone in the year to March despite both imports and exports dropping over the 12 month period. The EUR/USD finished the offshore session on its highs at 1.3560 whist USD/JPY exchanged n ear its peak at 96.30 with U.S equity markets surging almost 3% higher. The move came following an increase in confidence amongst U.S homebuilders as measured by the May NAHB Housing market index.

:: Data Releases:

• AUD: RBA Board minutes, RBA Governor Stevens & Treasury Secretary Henry Speak

• NZD: No Data Expected today

• USD: Apr Housing Starts & Apr Building permits

• GBP: Apr Consumer Price Index & Apr Retail Price Index

• EUR: May ZEW Survey & Mar Construction Output

• JPY: Mar Industrial Production & Mar Capacity Utilization

• CAD: No Data Expected today

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