Australia: With little influential data released during the offshore session the AUD traded fairly flat, opening only slightly higher this morning at USD1.0180. With mixed US data released overnight it left the AUD unsure of where to move. The indecision in the market could also be due to today's RBA interest rate meeting. While the majority of investors are confident that an interest rate rise will not occur, close attention will be paid to the accompanying statement.

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In February's Monetary Policy Decision Statement it was noted that current inflation levels are consistent with the medium term objective of monetary policy, there is continued uncertainty of the pace of recovery in the US and European economies and that the lending rates in the economy are now a little above average; with these influences likely to be reiterated in today's statement. Recent events that are also likely to get a mention are the recent natural disasters that we've experienced in Australia as well as the tensions in Libya. Today also sees the release of retail sales data in Australia and the countries current account data ahead of this week's GDP data.

Majors: As mentioned above, data out of the US was mixed overnight. Although not all the data was strong, most of the top tier data was positive. PMI's all around the country were stronger with the Chicago PMI outperforming the rest. The index rose to 71.2 in February, up from 67.5 which is its highest reading since 1988. The Dallas Feb Manufacturing survey was also stronger up to 17.5 from 10.9 a month earlier. The weaker data included consumer spending which grew at its weakest pace since June only increasing 0.2% in January. With the data adjusted for annual inflation, its result is actually -0.1%, falling for the first time in a year. With consumer spending accounting for about two thirds of the US economic output, this indicates a soft start to the year. As the unrest in the Middle East shows no sign of ending and the price of oil continues to rise, the expectations that the BOE will raise interest rates this year to combat the rising inflation in the region has seen the GBP/USD rise to a one month high, opening at 1.6265.

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