Australian Dollar:
Pointing towards increased demand for Australian resources, China’s trade balance figures released yesterday revealed imports from Australia were at their highest level in eight months in March, climbing a staggering 18.4 percent from a year earlier. Triggering a move higher for the Australian dollar, the positive reading was enough to push the higher yielding asset close to a three month high of 1.0551 when compared against the Greenback. With well worn resistance levels of 1.05 now having been breached local unemployment figures which are expected to be released at 11:30 this morning will be critical in determining just how strong support at 1.0500 is. Meanwhile this morning the Aussie opens half a cent stronger at 1.0540.

We expect a range today of 1.0500 – 1.0580

New Zealand Dollar
For the second time this week the New Zealand dollar has been the major benefactor of positive data flows from China. Following on from the softer inflationary read on Tuesday trade balance figures released yesterday once again defied expectation by revealing the nation’s first trade deficit in March since February 2012. Acting as a catalyst for the broader move higher the New Zealand dollar is now trading at its highest point since August 2011. Having appreciated to an overnight peak of 0.8577 the Kiwi opens close to those levels this morning as it buys 85.73 US Cents. On the outlook today a business manufacturing index reading due to be released this morning should provide some indication of whether any further upside is limited.

We expect a range today of 0.8540 – 0.8590

Great British Pound:
UK Stocks along with the Great British Pound advanced yesterday after a report showed Chinese imports increased more than forecast. With US equity markets also surging above record levels risk sentiment has favoured the Sterling which reached an overnight high of 1.5325 against the Greenback. Despite the small gains overnight given the light economic calendar expected over the back end of this week, it’s likely the Sterling will struggle in finding a clear cut direction. Meanwhile on the cross the Great British Pound is weaker against the Aussie (1.4537) and the Kiwi (1.7870).

We expect a range today of 1.4500 – 1.4570

Majors:
General and familiar themes have prevailed over the past 24 hours with Japanese Yen weakness once again returning to the marketplace. Evident in a higher USD/JPY which reached a peak of 99.864, triggering the sell-off BOJ Governor Haruhiko Kuroda stated that the Central Bank will continue to take all necessary measures to boost inflation. In other currency movements the Euro fell against the Greenback as minutes released from the US Federal Reserve’s most recent meeting revealed that some committee members felt the Central Bank should begin tapering its quantitative easing program later this year should labour market conditions improve as anticipated. With the credentials of the US dollar so closely linked to stimulus bets economic releases over the past week have done little to help its cause. Opening this morning weaker the Shared Unit currently swaps hands at a rate of 1.3070.

Data releases

AUD:
MI Inflation Expectations, Unemployment Rate

NZD: Business NZ Manufacturing Index,

JPY:
Core Machinery Orders m/m, CGPI y/y

GBP: MPC Member Tucker Speaks

EUR:
ECB Monthly Bulletin

USD:
Unemployment Claims, FOMC Member Bullard Speaks, Import Prices m/m

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