Bell FX Currency Outlook: The Australian Dollar is higher as the prospect of a stable interest rate outlook helps investors shrug off last week's disappointing jobs figures.

Australia: This morning, the AUD is trading at 0.9050 which is up from 0.8990 late Friday. The currency has traded in more than a one US Cent range since late last week after it was reported the unemployment rate in January had hit 6% for the first time in over 10 years. The market is looking ahead to Tuesday's release of the Reserve Bank of Australia's February board meeting minutes and then beyond, hoping the RBA's decision to drop their easing bias means brighter times await. This could be an extremely interesting development for the AUD's fortunes for 2014. The local data flow continues this week with the Q4 NAB Business Survey for SME's that will reveal whether they have enjoyed the upturn already evident in the survey for larger enterprises. Tomorrow's RBA minutes will be followed on Wednesday by the ABS Wage Cost Index for the December quarter, wages obviously an important ingredient in domestic costs, however the Flash Manufacturing PMI in China will likely set the tone for the AUD.It's the Presidents' Day holiday in the US tonight so a quiet day is expected in the markets.

Majors: In currency markets, weaker data once again drove yields and the USD lower. The US stock market completed its best week in some time, while emerging markets also continued their recovery. Better data in the UK and Europe supported core currencies. Chinese new loans data printed higher than expected over the weekend. While this is good news for short term growth risks, in the medium term a continued leveraging in China will add to financial stability risks and make the rebalancing of growth more difficult.

Economic Calendar

  1. 17 FEB AU New Motor Vehicle Sales MoM Jan
  2. AU NAB Qtrly SME Survey Q4
  3. JN Industrial Production MoM Dec
  4. US Public Holiday - Presidents' Day

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