Bell FX Currency Outlook: The Australian Dollar has remained steady overnight despite the markets reassessment of last week's FOMC minutes.

Australia: The Australian Dollar has opened marginally higher after a relatively quiet overnight session. The US Dollar came under some selling pressure as markets re-assessed the FOMC minutes released last week, which saw some suggest quantitative easing could end as soon as this year and bets the ECB may refrain from signalling more interest rate cuts on Thursday night.

The AUD has benefited recently from a lack of liquidity in still thin holiday conditions trading back to recent highs yesterday above 1.0500 against the Greenback.

Offshore factors will continue to provide direction for the AUD during today's session along with domestic Trade Balance figures for November due at 11:30am this morning. Market expectation is for the deficit to have increased to around AUD 2.3bn.

Tomorrow will see Domestic retails sales due along with Chinese Traded Balance data.

Majors: US equity markets retreated from five-year highs overnight as investors turned cautious ahead of fourth-quarter company earnings.

The move spurred a selloff in riskier assets and saw some safe haven bond buying. Corporate profits are expected to show signs of a tepid holiday spending period as concerns over the fiscal cliff situation created some hesitancy in both consumers and businesses in the quarter.

Both the S&P 500 and DJIA ended 0.4% lower in choppy trade at 1,460 and 13,378 respectively. European Equities were also lower with the German DAX ending 0.6% lower at 7,733 while the FTSE shed 0.4% to 6,065.

European financial stocks however, received a boost in the session after the Basel Committee decided to grant banks four more years and greater flexibility to build up cash buffers.

The euro erased earlier losses against the US dollar trading back above 1.3100 late in the session as expectations the
ECB may point to the prospect of lower rates early this years from the current 0.75percent.

Spot gold prices were slighter weaker as markets pare back QE3 expectations for this year, falling 0.5% to USD 1,647 per ounce. Oil prices ended the session marginally higher with Brent rising 0.1% at USD 111.4 per barrel and WTI futures rising 0.4% to USD 93.2 per barrel.

Metals and commodities were mixed after a quiet night data wise. Tonight will see the release of European Employment data along with Retails sales figures and German factory orders.
Economic Calendar
8 JAN AU AiG Performance of Construction Index
AU Trade Balance
EU Business Climate Indicator
GE Current Account (euros)
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