:: Australian Dollar: In what was a very volatile session in Asia yesterday the Aussie dollar climbed back from its open near 66 cents to post a late afternoon high slightly above the 68 cent mark. In local trade stronger than expected housing finance figures, a rebound in commodities and improved sentiment on Asian equity markets assisted the rally. Offshore investors however took this as an opportunity to sell the high yielding currency and with U.S Retail Sales figured disappointing analysts the AUD followed equity markets lower to open this morning back below 66 cents. All eyes in local trade today will be on the release of official employment figures for the month of December with many tipping unemployment to rise from 4.4% to 4.5% and possibly higher.

- We expect a range today in the AUD/USD rate of 0.6520 to 0.6620

:: Great Britain Pound: The Pound Sterling jumped from 1.4600 to a high of 1.4710 in early London exchange against the Greenback only to quickly retreat to 1.4490 after a spike in demand for Euro against the Pound and a 3% fall in U.S equity markets. It did settle into somewhat of a narrow trading range between 1.4540 and 1.4630 for the majority of the NY afternoon and opens this morning at 1.4560. With the Pound holding relatively stable against the greenback and the Aussie dollar plummeting the cross rate rallied to a high near 2.2150 and is exchanging at 2.2085 in early morning trade.

- We expect a range today in the GBP/AUD rate of 2.1980 to 2.2180

:: New Zealand Dollar: The Kiwi ran into a brick wall of resistance near 56 cents in early European trade and retreated in quick fashion as heightened risk aversion emanated through the markets once again overnight. U.S December Retail Sales figures came in almost twice as bad as some analysts had been expecting and with equity markets dropping around 3% in America the NZD crashed to a low of 0.5390. With employment data due for release across the Tasman today the NZD may find some support on the cross rate which opens this morning near its overnight lows at 0.8210.

- We expect a range today in the NZD/USD rate of 0.5330 to 0.5430

:: Majors: Analysts had been expecting December Retail Sales out of the U.S to indicate a significant slowdown in consumer spending with forecasts ranging between a negative 1.2% and negative 1.5% for the month. Last nights announcement of a larger than expected 2.7% decline sent equity markets lower and as a result risk aversion fears heightened. In what has become a common theme EUR/JPY fell away and so too did the big dollar in trade against the Japanese Yen falling from an early European high near 90 to an overnight low of 88.60 following the announcement. The Euro also lost ground falling from 1.3330 to exchange below 1.3100 ahead of tonight's much anticipated ECB meeting where many are expecting a 50 basis point reduction in official interest rates. In other economic news released overnight Euro-Zone Industrial Production fell by a less than expected 1.6% whilst inflation in France eased from 1.6% to 1% boosting the argument for a larger than 0.5% rate cut tonight.

:: Data Releases:

• AUD: Dec Employment Data

• NZD: No data expected today

• USD: Dec PPI & Jan Empire Manufacturing

• GBP: No data expected today

• EUR: ECB Rate Decision & Dec Euro-Zone CPI

• JPY: Nov Machine Orders

• CAD: No data expected today

:: 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.

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