Australian Dollar:
Increasing the pressure on the Reserve Bank to further lower domestic interest rates Retail Sales suffered a surprise blow in the month of November falling by 0.1 percent. Coming in well below expectation the disappointing figure demonstrates the full extent of consumers spending cuts throughout the economy. Acting as a catalyst for the move lower the Australian dollar fell immediately after the announcement touching a mid afternoon low of 1.0485 against its US Counterpart. Remaining relatively firm as the higher yielding asset entered North American markets a strong start to the US Corporate earnings season has certainly contributed in a positive manner to global risk sentiment this morning. Whilst Building Approval data due for release this morning will likely provide some direction for the Aussie overall the domestic unit continues to struggle with a value in excess of 1.05. Meanwhile the Aussie opens slightly higher this morning swapping hands at a rate of 1.0515.

We expect a range today of 1.0480 – 1.0540

New Zealand Dollar
In figures released yesterday building consents for new homes continued a 20-month growth trend by once again rising in the month of November. Adding to signs that demand in the housing market is still recovering the figure which showed the trend for new houses is up 41% since March 2011 did provide a slight boost for New Zealand’s dollar. Reaching overnight highs of 0.8408 the Kiwi was further supported by a positive overnight session in the US where aluminium maker Alcoa got US corporate earnings off to a good start. In what is shaping up as another quiet session the New Zealand Dollar opens overall unchanged this morning currently buying 83.93 US Cents

We expect a range today of 0.8360 – 0.8420

Great British Pound:
The Great British Pound has come under some significant selling pressures over the past 24 hours after a government report showed the trade balance narrowed by a smaller than expected amount in November. Whilst the deficit did shrink to 9.16 billion pounds this still fell short of the expected 9 billion which was forecast. Falling below the 1.60 mark for the first time in five weeks speculation that the Bank of England may introduce further stimulus when they meet tonight only added to the woes of the Sterling. After bottoming out at a rate of 1.5991 the Great British Pound opens noticeably weaker against the Greenback this morning at 1.6029. Meanwhile on the cross rates the Sterling is weaker also against both the Aussie 1.5241 and the Kiwi 1.9090

We expect a range today of 1.5210 – 1.5270

Majors:
Global stocks received a welcome boost overnight after US Corporate earnings came in better than expected. Highlighting what can be achieved when investors focus on real results ahead of the political squabbling that we have seen last night’s results have provided a positive tone amid a dovish backdrop. On the currency front, stronger against a handful of its major counterparties the US Dollar remained firm overnight whilst the Japanese Yen weakened following renewed speculation that the Bank of Japan will expand stimulus when they next meet. In Europe, the final revision of quarter 3 GDP came in spot on expectation at – 0.1% confirming that the region remains in recession whilst German Industrial Production slowed noticeably in November growing by a mere 0.2%. Taking its toll on the shared unit the Euro opens weaker this morning at 1.3061 with further volatility expected tonight given the ECB are set to meet to discuss their Policy Stance.

Data releases

AUD:
Building Approvals m/m

NZD: Trade Balance

JPY:
Leading Indicators

GBP: Asset Purchase Facility, Official Bank Rate

EUR:
French Industrial Production m/m, Minimum Bid Rate, ECB Press Conference

USD:
Unemployment Claims