Bell FX Currency Outlook: Commodity currencies were driven lower again overnight due to the ongoing uncertainty over the outlook for the euro zone.

Australia: The Australian dollar came close to breaking through the parity level but couldn't quite find the selling momentum to push through the key USD1.0000 level. However, given the ongoing events in Europe it does seem likely that the AUD will be back below USD1.0000 in the short term.

Expect a relatively tight trading range this morning ahead of the release of Australian employment figures for April due out at 11.30am AEST. Market expectations are for the unemployment rate to have increased marginally to 5.3% from 5.2% the previous month and for the number of employed to have fallen by 5k.

Local markets will also be paying close attention to the release of Chinese trade data later today. Given the close ties between the Australian and Chinese economies, today's release and also tomorrow's release of Chinese retail sales and industrial production could have an effect on the AUD's movements in the short term.

Majors: The euro continues to come under pressure as another chapter of the Greek saga grabs the headlines. Early in last night's session there was speculation that the euro-zone governments would hold back on a previously agreed release of funds to Greece.

These fears sent equity and commodity markets sharply lower, but some of these losses were later reversed when it was announced that EUR4.2bio of the funding would be released, with EUR1bio held back for potential payment by June if required.

The release of this latest tranche of financing resolves a short term crisis, but the problems in Europe still have the potential to escalate further in the medium to longer term. Greece's exit from the EUR is still a real possibility and as a result the EUR is likely to continue to trade lower.
Economic Calendar
10 MAY AU Employment Change APR
AU Unemployment Rate APR
CH Trade Balance APR
UK BOE Rate Announcement MAY