Bell FX Currency Outlook: The Australian Dollar is steady this morning as rumors build European Central Bank President Mario Draghi is working towards a breakthrough in the euro zone debt crisis.

Australia: It was a mixed session for markets overnight with US equities unchanged while European equities retreated slightly. Italian and Spanish 10-year yields rose 13bps and 11bps respectively but were not helped by Catalonia's request for a €5bn bailout from a Spanish government fund.

ECB President Draghi announced he is not attending the Jackson Hole central bank conference due to his heavy workload and the markets feel the ECB policymakers are attempting to make progress in deciding which policies and tools should be utilised to support the currency union ahead of the ECB's next policy meeting on 6 September.

EUR/USD gained close to 90 points before encountering upside resistance around 1.2570, with the AUD and NZD notable underperformers in broad-based USD weakness.

The Australian Government announced Australia and Europe will be linking their emissions trading systems, with full two way trade expected by July 2018.

In Australia today we have the first partial indicators for Q2 GDP with construction work done released at 11:30 AEST. Prior to this we expect quarterly GDP growth of 0.8% in Q2, but also expect the Q1 estimate to be revised lower. In offshore markets, revised Q2 US GDP data is released tonight along with the Fed's Beige Book.

Majors: On the US economy front, a mix of reports with another sign of an improving housing market, but consumer confidence is still fragile.

The Conference Board's measure of US Consumer Confidence in August not only fell back to the lowest since last November from an eight point decline in the expectations component but the "jobs plentiful" index also backtracked, a reflection on the street of a still weak job market.

Tonight, the focus will be on the Fed's Beige Book summary of the latest regional US economic conditions ahead of the upcoming September 13 FOMC meeting. US Pending Home Sales for July are also on the schedule with a 1% rise tipped. There is also a French business confidence survey following the soft German survey on Monday night.
Economic Calendar
29 AUG US GDP 2Q
Fed's Beige Book
US Pending Home Sales JUL
AU Construction Work Done 2Q

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