Australia: Yesterday, the Australian Consumer Confidence reported a fall 8.3% for July, its lowest level in two years as concerns re-emerged about the European debt crisis, higher interest rates locally and the carbon tax.

[Join us on the Forex Traders Community]

On a positive note the Chinese GDP came in up 2.2% for Q2 to be up 9.5% year on year better than the market had expected, while the Chinese retail sales reported a rise 17.7% year on year.

Also out of China, Industrial Production rose 15.1% year on year in June.

These strong figures eased some of the ongoing concerns that the Chinese economy is slowing.

Base metals rallied overnight on the back of a weaker US dollar, nickel was up 1.4% and zinc up 0.5%. Gold traded up 1.5% to be trading at US$ 1,586.00 per ounce and Oil rallied up 0.6% trading at US$98.05 a barrel.

This morning in New Zealand the 1Q GDP reported a rise of 0.8% much better than the expected rise of 0.4%.

Today we expect the AUD to hold firm as the US weakness overnight should carry though to the Asian trading session.

Majors: In the US overnight the Fed Chairman was delivering his semi- annual testimony to the House of Representatives saying that the Fed would provide “additional policy support” if the recent weakness in the US economy remained persistent or deflationary risks re-emerged.

While he did say that he expected stronger activity and job creation after the temporary shocks that have been holding back economic growth had passed.

Equity markets rallied on his speech with the possibility of a QE3 package, though gains faded towards the close with the Dow finishing up 0.45 the S&P 500 up 0.3% and the Nasdaq up 0.5%.

On the data front the US monthly budget deficit narrowed to $43.1bn in June from $68.4bn due to cuts in spending.

Meanwhile in Europe the focus is on Italy with its Senate due to pass the 40bn euro austerity package tonight.

Rating’s agency Fitch cut Greece’s credit rating three notches to CCC+ following downgrades by S&P and Moody’s in June.

More from IBT Markets:
Follow us on Facebook.
Follow us on Twitter.
Subscribe to get this delivered to your inbox daily