Australian Forex, Commodities from BELLFX

Yesterday's release of the Australian employment data showed the unemployment rate rose to 5.3% in August from the 5.1%, as full time employment fell by 9,700 in the month. This was well below markets expectation of an increase of 11,000 jobs. While the jump in the unemployment rate is unlikely to cause the RBA to cut rates in the near future, close attention will be paid to ensure this does not become a trend in the coming months. The AUD continues to perform well on the cross rates with the AUD/EUR trading to EUR0.7600, and the AUD/JPY is trading above JPY82.00.

Base Metals

Base metals were higher overnight with copper up 0.2%, zinc up 0.5% and nickel up 1.4%. Gold is also firmer trading at US$1855.00 per ounce while oil fell 0.35% to US$89.05 a barrel. There is no local data due for release today, although markets will focus closely on the data releases from China (due out at 11:30am AEST) which includes CPI, Retail Sales and Industrial Production.

Majors: Overnight in the US equities markets lost ground with the Dow falling 1.0%, the NASDAQ down 0.8% and the S&P 500 ended down 1.1%.

On the data front the US trade deficit reported a surprise fall to $44.8bn in July from $51.6bn in June, showing that the weak US dollar and lower crude prices are helping US exports. The US consumer credit rose $11.96bn in July following the $11.35bn increase in June. Equities markets where sold off after the Federal Reserve Chairman Ben Bernanke disappointed the market by not providing any details on a proposed stimulus plan during his speech to the Economics Club in Minnesota.

Meanwhile in the UK the Bank of England kept its official rates on hold at 0.5% and maintaining the amount of quantitative easing at GBP 200bn. In Europe the ECB also kept rates on hold which did disappoint some, while Norway's Norges Bank has signalled that it may cut rates to combat a strengthening currency and head off undesirably low inflation.