A man walks past various currency signs, including the dollar (top R), Australian dollar (top L), pound sterling (centre L) and euro (bottom L), outside a brokerage in Tokyo October 28 2014.
A man walks past various currency signs, including the dollar (top R), Australian dollar (top L), pound sterling (centre L) and euro (bottom L), outside a brokerage in Tokyo October 28 2014. A year-long investigation into allegations of collusion and manipulation by global currency traders is set to come to a head on Wednesday, with Britain's financial regulator and six big banks expected to agree a settlement involving around ?1.5 billion ($2.38 billion) in fines. The settlement comes amid a revival of long-dormant volatility on the foreign exchanges, where a steady rise of U.S. dollar this year has depressed oil prices and the currencies of many commodity exporters such as Russia's rouble, Brazil's real and Nigeria's naira - setting the scene for more turbulence on world financial markets in 2015. Picture taken October 28, 2014. Reuters/Yuya Shino

Bell FX Currency Outlook: The Australian Dollar is trading above 78 cents following a relatively quiet night.

Australia: The AUD has risen over half a percent against the USD in the last twenty-four hours, as optimism out of Europe and some weaker than expected US data saw the USD lose ground against most major peers overnight. The AUD made gains yesterday following the release of this month’s RBA meeting minutes. The Reserve Bank gave no indication of further rate cuts in its latest update but maintained its generally dovish tone. The ASX 30 Day Interbank Cash Rate Futures are pricing in a 58% chance of a further rate cut at next month’s meeting. The AUD was trading around 0.7760 prior to the release of the minutes, before rising above 0.7800 yesterday afternoon. With no major data releases in Australia today and the start of Chinese New Year celebrations, it is expected to be a quiet day for the AUD.

Majors: The EUR traded higher on rising hopes that Greece will find common ground with its eurozone partners for support beyond its current bailout program. Despite talks between Greece and its creditors breaking down on the previous day, Greece’s Finance Minister Varoufakis stated that the Greek government had been prepared to accept an extension of the current bailout package under certain terms. Some good European data also helped boost the EUR; the ZEW survey results showed a rise in the current situation series from 22.4 to 45.5 (30 expected), while the expectations series also recorded a solid rise to 53 (55 expected) from 48.4. This was the fourth consecutive monthly increase in both data sets. GBP is lower as inflation data showed the CPI declined 0.9% m/m in January taking the annual pace of growth to 0.3%, the lowest rate since records began in 1989. As stated above, US data was a little disappointing, with the NAHB index falling from 57 to 55 in February and the Empire manufacturing survey easing modestly to 7.78 from 9.95 in January. Tonight central banks are the focus, with the BOE and FOMC both releasing the minutes of their last meetings. Also being released is UK employment data.

Economic Calendar 18 FEB

  • JN Bank of Japan Monetary Policy Statement
  • AU Westpac Lending Index MoM
  • UK Bank of England Minutes
  • US Fed Releases Minutes from Jan 27-28 FOMC Meeting

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