Australian Dollar
The Australian Dollar continued its bullish run as positive signs out of Europe spurred traders to continue to hold riskier assets. The local unit traded between 1.0687 and 1.0780 as news hit the wires that the European Central Bank had swapped its Greek debt holdings and adding further speculation that Greece will be bailed out for the second time in as many years. In other news US CPI for the month of January came in at 0.2% versus a previous reading of 0.0% as an increase in the cost of fuel and clothes was the main catalyst for the rise. On the local data front this week tomorrow’s release of the minutes from the RBA’s last meeting will provide a potential insight into the direction of local interest rates over the next few months.

We expect a range today of 1.0735 to 1.0810

New Zealand Dollar
The kiwi (0.8380) opens higher against its US counterpart today and was the beneficiary late last week of positive risk sentiment amid optimism that Greece will get a second bailout. The currency hit a 24-hour high of 0.8383 as the greenback weakened against several of its major rivals. Comments from central bank chief Mr. Alan Bollard who said the local economy’s size may be understated also buoyed the unit. The Japanese Yen weakened pushing the NZD/JPY rate to six-and-a-half month highs and opens today at 66.71. Meanwhile, the kiwi is at all-time highs against the 17-nation Euro at 0.6350.

We expect a range today of 0.8350 to 0.8400

Great Britain Pound
Retail sales in the United Kingdom unexpectedly rose in the month of January, posting a 0.9% increase on sales recorded in December. Adding to sentiment surrounding the release was the fact this is now the second consecutive month the retail sector has achieved growth and hence Sterling was boosted from its earlier trading range. After spending most of Friday trading 10 points either side of 1.5800 against the Greenback, the Pound rallied to highs above 1.5850 before settling to close the week at 1.5825. Meanwhile, sterling opens little-changed against the Australian Dollar at 1.4680 and marginally lower against the kiwi at 1.8875.

We expect a range today of 1.4650 to 1.4715

Majors
After spending the majority of Friday's Asian session trading just above short-term support at 1.3120 the Euro began to lift from these levels early on in the switch to local trade. German Producer Price Index (PPI) increased 0.6% in January and Europes current account posted a surplus of 2 billion Euros. With no answers on the next instalment of funds for Greece expected until after the weekend, upside movement was limited and resistance was met at 1.3190. Earlier in the day, Bank of Japan released their monthly monetary policy meeting minutes which re-affirmed the unanimous vote to expand their asset purchasing program. Consolidating earlier moves lower, the Yen drifted above 79.00 against the Greenback for the first time since October 31 2011; the last time the BOJ intervened in the currency markets. A cooler than expected set of fundamentals from the United States combined with ongoing nerves in Europe to dampened risk sentiment into the close of markets. With momentum in the Greenback favour, the risk off environment sent the Yen lower to close the week at 79.50. The Euro Dollar also lost steam, closing the week at 1.3140. The Euro opens the new week in Sydney marginally higher at 1.3170.

Data releases

AUD: No data today

NZD: Producer prices, Q4

JPY: Merchandise trade balance, Jan

GBP: Rightmove house prices, Feb

EUR: No data today

USD: Markets closed for President’s Day