Daily Forex Forecast 03/07/2013
Australian Dollar:
Reaching its highest level in over a week against its US Counterpart the Australian dollar was propelled forward yesterday after domestic GDP figures came in spot on expectation. Gaining around half a cent investors were spurred on following a growth reading which showed Australia’s economy expanded by 0.6 percent in the final quarter of 2012 taking the final year figure to 3 percent. Despite touching an intraday high of 1.0300, the overall shift forward proved short lived with all early gains turning losses as North American investors took the opportunity to take profits. It what may become longer lasting trend, positive economic releases throughout the US have also strengthened the Greenback overnight. Opening this morning overall unchanged at 1.0238 the busy week continues today with the expected release of Trade Balance figures at 11:30am.
We expect a range today of 1.0200 – 1.0270
New Zealand Dollar
The US dollar rallied across the board overnight following the release of a US private sector jobs report which showed US private employers added 198 000 jobs in February, well above what was forecast. In a positive sign for the world’s largest economy the New Zealand dollar was unable to keep up with a stronger Greenback breaking below the 83 US Cents mark overnight. Opening around a third of one cent weaker this morning at a rate of 0.8287 many economists have suggested the Kiwi will struggle to maintain its recent strength should the US recovery story gain further traction.
We expect a range today of 0.8250 – 0.8320
Great British Pound:
The Great British Pound has weakened against all but two of its 16 major counterparties overnight as investors continue to speculate that the Bank of England will increase its asset-purchase facility to at least 400 billion pounds when they meet this evening. With three out of the MPC’s nine members indicating that they voted for additional stimulus when they last met in February the Sterling would be set for another notable sell-off if fresh measures were adopted. Falling from an earlier high of 1.5154 against its US counterpart the Sterling opens this morning more than a full cent weaker at 1.5034. Meanwhile when compared against the Aussie (1.4683) and the Kiwi (1.8138) the sell-off has been just as abrupt.
We expect a range today of 1.4650 – 1.4720
Majors:
Despite some notable swings overnight markets open this morning extending their gains. In response to some positive fundamentals a US private sector jobs report showed private US employers hired 198 000 new workers in February, adding even further interest to the key non-farm payroll figure expected to be released on Friday where the underlying unemployment rate is forecast to remain unchanged at 7.9 percent. With figures also showing factory orders shrunk by a smaller than expected amount, the beige book (analysing economic conditions across 12 US districts) showed the US economy expanded at a modest to moderate pace. Leading a notably stronger Greenback the Euro has struggled to keep pace with the shared unit dropping below the critical 1.30 level. Shedding half a cent the euro is weaker this morning at a rate of 1.2991. On the outlook this evening, investors will have a close eye on several key Central Bank meetings with the accompanying statements from the ECB, BOE and BOJ likely to spark speculation of further stimulus particularly from the BOJ and BOE.
Data releases
AUD:
AIG Construction Index, Trade Balance
NZD: No data today
JPY:
Monetary Policy Statement, Overnight call rate
GBP: Halifax HPI m/m, Asset Purchase Facility, Official Bank Rate, MPC Rate Statement,
EUR:
Minimum bid rate, ECB Press Conference, Spanish 10-y bond auction, French 10-y bond auction, German factory orders m/m
USD:
Trade Balance, Unemployment Claims, Revised nonfarm productivity q/q, FOMC Member Powell Speaks, Bank Stress Test Results