Australia: Early yesterday the AUD was pretty much contained within its recent trading range around USD1.0100. Australian employment data failed to have any impact on the AUD with the data showing that employment had fallen 10.1k in February (Expectation +20k) with the unemployment rate steady at 5.0%. However when the Chinese announced a trade deficit of $US7.3 billion, the second one in two years, the AUD started to loose ground against the USD.

[Get this delivered to your inbox for FREE. Subscribe to our daily Markets Newsletter.]

The market was expecting a surplus of $US6.45 billion in January, so for it to be so far from expectations, it was a big surprise to the market. Continued unrest in the Middle East and news that Moody's had downgraded Spain's credit rating also added to the pressure to the AUD. Tonight we have no major data being released so equity markets are likely to provide direction to the local unit. Support levels for the AUD are currently around USD0.9975, while resistance remains around USD1.0100.

Majors: The USD was stronger Thursday night as euro-zone debt worries and reports of violence in Saudi Arabia triggered risk aversion trading back into safe haven currencies. The CHF and the JPY also advanced when it was reported that Saudi police had fired rubber bullets Thursday to disperse protestors in Qatif, a town in the oil rich Eastern Province. Elsewhere, concerns resurfaced about Europe's sovereign debt crisis, with many now waiting for the outcome of tonight's meeting of euro-zone leaders. The market is worried whether or not the euro-zone can successfully resolve its sovereign debt issue and with the possibility of the ECB increasing interest rates in coming months, it would make borrowing costs for the struggling countries unsustainable. Looking ahead the market will be watching the results from tonight's meeting of euro-zone leaders and for any further developments in Saudi Arabia.

More from IBT Markets:
Newsletter: To receive Global Markets update, sign up here