Bell FX Currency Outlook: The Australian Dollar is trading higher this morning following some weaker than expected
data in the US and a stronger gold price.

Australia: After a fairly quiet day locally, the AUD pushed higher overnight, trading up through USD0.9250. Weaker than expected figures in the US showed existing home sales dropped by 1.2% in June, the market was expecting a gain of 1.5%. The market sold the USD off on the back of the result, pushing the AUD higher.

Price action in gold overnight also helped to support the AUD, with gold futures posting their biggest gain in more than a year and settled above $1300 an ounce for the first time in a month.

There is no key data due for release today, so that leaves us watching for Wednesday's Q2 CPI data and the China manufacturing PMI as the next major influences for local FX markets.

Majors: The USD has fallen against the major currencies after disappointing data renewed talk of a slower scale back to the Fed's aggressive bond-buying program. In recent weeks, the USD has generally risen against major currencies on the expectation that the Federal Reserve would pull back on some of its most aggressive expansionary policies earlier than other leading central banks.

After a recent spate of unimpressive US housing data US monetary policy makers may be made to rethink the path of unwinding the bond-purchasing program.

Meanwhile the JPY surged in the wake of weekend elections that boosted Prime Minister Shinzo Abe's ruling Liberal Democrats. Among other currencies the GBP rose to $1.5360 from Friday's level of $1.5258. The USD dropped to CHF0.9360 from CHF0.9406.
Economic Calendar
23 JULY US House Price Index
US Richmond Fed Manufacting Index
EC Euro-Zone Consumer Confidence