Australian Dollar
The Australian dollar fell following recent stimulus euphoria as doubts about its implementation as well as poor Chinese manufacturing data cast doubt over the higher value of the Aussie. After opening near 1.0480, the local unit fell to lows below 1.0370 before some positive manufacturing data from Germany managed to spur a minor risk rally. Opening this morning back at 1.0430, CB leading index data is due for release this morning although a generally quiet day globally may lead to a consolidation phase into the weekend.

We expect a range today of 1.0400 – 1.0480

New Zealand Dollar
The New Zealand Dollar gained ground against its US Counterpart yesterday after a report showed the domestic economy grew at 0.6 percent in the second quarter, twice the expected pace. In an overall positive move for the Kiwi the higher yielding asset traded as high as 0.8302 against its US Counterpart despite the market hearing news of a disappointing Manufacturing read in China. Combine China’s read with weaker than expected manufacturing figures throughout Europe and the US and the Kiwi manages to open only marginally stronger this morning currently buying 82.87 US Cents.

We expect a range today of 0.8240 – 0.8320

Great British Pound:
A dismal reading in UK Retail Sales saw the Pound fall below the 1.62 mark against the US Dollar as the London Olympics and extra bank holidays kept shoppers off the high street and away from shops. The reading came in at negative 0.2% compared with the previous months reading of positive 0.3 and will no doubt have the members of the Bank of England thinking about a potential interest rate cut and additional Quantities Easing methods (currently at GBP375 million Pounds) when they meet again next month. Against the Australian and New Zealand dollar the Pound is currently exchanging at 1.5530 and 1.9540.

We expect a range today of 1.5510 -1.5590

Majors:
Just 24 hours after the Bank of Japan increased proposed asset purchases by 10trillion Yen and just one week after the US Fed announced QE3 Measures and already it appears the market has forgotten all about the Stimulus investors spent so much energy on anticipating. In a move which is essentially forcing investors to look at the underlying fundamentals, data out of both China and Europe overnight has again increased concern that the global economic slowdown is worsening. Trading to an overnight low of 1.2918 against its US Counterpart the Euro was well and truly weighed down after a survey showed activity in the Euro-zones service sector declined at the fastest pace since July 2009. Despite a positive Bond auction which saw Spain successfully sell $6.2 Billion worth of bonds, the most since January the Shared Unit opens overall weaker this morning at 1.2969.Meanwhile in the US overnight, investors will need to wait a little longer to see whether stimulus measures have the desired impact after a Philly Fed Manufacturing Index also showed US manufacturing closing out its weakest quarter in three months as more people continued their such for employment as witnessed through a weekly jump in US unemployment claims from and expected reading of 374 000 to 382 000

Data releases

AUD:
CB Leading Index m/m

NZD: Visitor Arrivals m/m

JPY:
No Data Today

GBP: Public Sector Net Borrowing

EUR:
Belgium NBB Business Climate

USD:
FOMC Member Lockhart Speaks