Daily Forex Forecast 05/13/2011
Australian Dollar: The recent woes of the Aussie were compounded by local employment data yesterday and after falling almost 2 cents in the 12 hours prior to the release another cent was given up almost immediately.
A total of 22,100 employment positions were lost last month and although the actual rate of unemployment remained unchanged at 4.9% the Australian Dollar plummeted, moving from 1.0700 to a low of 1.0585 before settling around 1.0600.
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As the session wore on the Aussie managed to reclaim some of these losses and before headed into offshore trade around 1.0650. An overnight rebound in US stocks and commodities provided the Aussie with some relief and by the opening of Asian markets it is back trading around 1.0670.
We expect a range today of 1.0620 - 1.0740
New Zealand Dollar: After a slight sell off towards the end of the onshore session yesterday the New Zealand Dollar rallied from intraday lows of 0.7840 to nearly break 80 cents once more by New York trade. Spurring the rally was a recovery in US equities and commodities and the Kiwi rose quite rapidly to highs near 0.7990 before tapering off to start the day at 0.7950. In cross trade, the Kiwi took opportunity to reclaim some more ground against the Aussie yesterday after disappointing employment figures were released across the Tasman. The pair traded to a high of 0.7455 during the local session before another rally offshore took it to 0.7485 and we open today at 0.7455.
We expect a range today of 0.7860 - 0.7990
Great British Pound: Manufacturing Production in the United Kingdom rose less than estimated overnight, reporting 0.2% growth compared to an expected 0.3%. This saw the Pound fall against the Greenback as markets speculated this would give the Bank of England leeway to hold interest rates at record lows for longer.
After trading up at 1.6370 for the first part of the day, Sterling slid as far as 1.6230 before heading into the final day of the week at 1.6285. This disappointing set of data all but wiped out any ground the Pound made against the Australian dollar earlier that day and the pair trades back down at 1.5260 at the time of writing. The New Zealand Dollar cross also sits lower this morning at 2.0480.
We expect a range today of 1.5180 - 1.5360
Majors: The Greenback has fallen versus the Euro, after reaching six-week high against the shared currency earlier this week it was unable to hold onto these gains. Pulled lower by a rebound in stocks and commodities the US Dollar also faced some worse than expected economic data in the form of core retail sales, which increased less than anticipated as well as the number of jobless claims decreasing at a slower rate than predicted.
The Euro rallied from lows near 1.4120 to reach a high of 1.4275, opening this morning at 1.4240. Also suffering from the recent flock back to riskier assets is the Japanese Yen which has pared some of the gains recently made against most of its counterparts. Opening lower against the Greenback as well the pair currently trade at 81.00.
Data releases
AUD: No data due for release
NZD: No data due for release
JPY: No data due for release
GBP: No data due for release
EUR: German Prelim GDP q/q; Flash GDP q/q; French Prelim Non-Farm Payrolls q/q
USD: Business Inventories m/m; Core CPI m/m; Prelim UoM Consumer Sentiment
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