Australia: The Australian Dollar is relatively unchangedthis morning at USD 1.0130 after firming slightly duringyesterday's local session. December's Australian retailsales data was released yesterday and was softer thanexpected.

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Myer downgraded its profit forecast, describingconsumers as cautious and JB Hi-Fi noted startingconditions in 2011 as being "tough". Domestic demand issoft and this surely means the RBA will remain on hold forat least the first half of the year. The first sitting this year ofFederal Parliament is today and the flood levy will nodoubt be near the top of the agenda.

The NAB businesssurvey is released today and will provide an early glimpseof data following on from the floods across Australia.Additionally, NAB are releasing a Special Business Surveyto assess the economic impact of the floods, focussing onthe economic impact through changes in the demand forgoods and services, the cost of rebuilding and temporary /permanent business closures in large to medium sizedfirms.

Business conditions and consumer confidence aretrending lower, yet our AUD remains resilient. We expect atight range today and remember the Chinese marketsremain on holiday. Key economic events this week includeAustralian January employment data on Thursday andtestimony to a parliamentary committee by the ReserveBank of Australian governor Glenn Stevens on Friday.

Majors: It was a relatively uneventful night for the USDollar with continued EUR/GBP selling on the back of ratehike expectations in the UK ahead of the Bank ofEngland's meeting on Thursday night. EUR/USD tradedmodestly lower as resentment simmers in Europe inrelation to the German government's proposal to stopwage indexation, raise retirement ages and lock debtlevels into national constitutions.

US equities remainedsolid as the market studied M&A activity and the fact that70% of S&P 500 companies have reported results withstronger than expected earnings, this is the largestproportion since 2006. Tonight sees German industrialproduction data and several Fed speakers on the USspeaking circuit.