Bell FX Currency Outlook: The Australian dollar has opened this morning on the mid 1.0700's after a fairly narrow trading range on Friday evening.

Australia: Although the AUD flirted again with the 1.0800 level on Friday evening the recent news flow has been fairly light as increasingly better economic news comes out of the US and recent European PMI's were slightly better than expected.

Last week saw European banks take up EUR529.5bn of 3 year funding at 1% from the ECB which was on the higher side of analysts' estimates.

Equity markets on Friday in Europe and the US were virtually flat as the USD was stronger and oil prices fell 2% for the first time in the last four weeks. On the weekend we learned that Chinese banks increased their lending in the first two months of 2012 perhaps in response to recent cuts in the reserves they must keep with the central bank.

Today in Australia we see the release of February's AiG performance service index, the TD inflation index, company profits and inventories and ANZ job ads.

Tomorrow the RBA will announce its decision on interest rates and virtually the entire market predicts no change in our cash rate as world financial markets have stabilised in the last month or two.

On Wednesday we will see the results of GDP growth for Q4 where the market expects a figure of 0.7% for the quarter. We expect a modest trading range today unless the local figures today reveal some surprises.

Majors: Another EU summit on the weekend produced little new information but it was learned that about half of the EUR130bn
bailout of Greece would be delayed until finance ministers looked at the implementation of 38 specific reform issues next week. Also agreed was further faster infusions into the ESM which meant the capitalisation program would be completed a year earlier (2015) than originally anticipated.

On a more negative note, Spain's estimated GDP growth for 2012 was reduced from 2.3% to 1.7% and the projected budget deficit is to widen to 5.8% from the 4.4% of GDP earlier expected.

Economic Calendar
5 MAR AU ANZ Job Advertisements FEB
CH China HSBC Services PMI FEB
EU Euro-zone Retail Sales JAN
US Factory Orders JAN