The Australian Dollar has pushed higher overnight, continuing its positive momentum from yesterday before a bit of consolidation occurred late in the session.

Australia: Strong local employment figures released yesterday help the AUD push towards USD1.0500 before Japanese after shocks halted its rise. The Australian Bureau of Statistics yesterday showed that 37,800 new jobs were created and the unemployment rate fell to 4.9%. The AUD rallied following the data and remained well supported for the remainder of the local session. Talk of the RBA now having to re-consider their policy stance also surfaced following the employment data, another factor supporting the AUD.

Increased risk appetite of investors continued to support the currency offshore before very strong aftershocks were reported in Japan. This saw the AUD retreat back towards USD1.0450 and it generally consolidated around that area for the remainder of the offshore session. With the lack of any local data being released locally today, direction is likely to come from any offshore developments however we to anticipate that it will remain well supported in this new trading range.

Majors: Last night the European Central Bank became the first major central bank to raise interest rates since the 2008-09 financial crisis. In a widely anticipated move, the ECB increased interest rates by 0.25%, however the EUR slid lower following the announcement as doubt was cast on how soon we would see any follow-up to the increase. ECB President Jean Claude Trichet disappointed the market by not giving anything away, instead there was only reassurance that the ECB will “monitor very closely” all developments.

Elsewhere, the GBP had a fairly subdued session after the Bank of England left their official interest rates on hold as expected, while the USD struggled against most of the majors, particularly the JPY and the CHF. Oil continued to rise on the back of ongoing tensions in the Middle East, while Gold hit another all-time high of USD1464.93 per ounce.

Economic Calendar

JP Current Account Total FEB
UK PPI Input / Output MAR
CA Employment Data MAR