Australian Dollar: The Aussie opens marginally lower against the greenback today at 0.9890. Monday's local session was largely uneventful as the unit failed to re-capture last Fridays high above 0.9920. Profit-takers moved in at this level and took the currency down to 0.9880 where it remained most of the afternoon and into the European session. In overnight trade, the Aussie moved as low as 0.9848 as Euro zone sovereign debt concerns took the Euro lower. The Reserve Bank of Australia meets today to discuss monetary policy and rates are set to remain on hold at 4.75 per cent. Also keeping a lid on the currency near-term is the strong likelihood that borrowing costs will remain unchanged through the first quarter of next year.

We expect a range today of 0.9840 – 0.9910

New Zealand Dollar: The kiwi opens lower against the greenback today at 0.7600 after range-trading throughout most of yesterdays local session between 0.7630 and 0.7650. There was no follow-through trade after the currencys risk rally last Friday night as the U.S. Federal Reserve chairman Mr. Ben Bernanke said in an interview yesterday (local time) that there could be further quantitative easing after last week’s disastrous payrolls data. The greenback moved higher after these comments keeping a lid on both the NZ and Australian currencies. Weighing on the minds of local traders this week will be Thursdays monetary policy statement by the Reserve Bank of New Zealand where the official cash rate is expected to remain on hold at 3 per cent.

We expect a range today of 0.7560 – 0.7635

Great British Pound: In the absence of any local economic data on Monday, the pound traded in a fairly subdued range (1.5655 – 1.5774) compared to recent standards. The currency moved lower on another bout of risk aversion as news from Europe emerged that officials remain at odds about how to contain the region’s sovereign debt woes. However, support around the 1.5660 level held several times throughout the session and the currency opens today at 1.5710 against the greenback (Sydney time). Meanwhile, the pound is steady against the Aussie (1.5870) and higher against the kiwi (2.0629).

We expect a range today of 1.5850 – 1.5940

Majors: The Euro opens lower on Tuesday as European officials remain at odds about how to contain the region’s sovereign debt woes. The 16-nation currency snapped a 3-day rally falling from the December 3 high of 1.3414 down to an intraday low of 1.3245. The Euro has fallen around 9 per cent against a basket of currencies throughout 2010 on the back of the debt crisis, and with no concrete solution in place just yet, will face further headwinds at least in the near-term. Meanwhile, the dollar opens at 82.56 against the Japanese Yen after US Federal Reserve chairman Ben Bernanke signalled in a television interview yesterday (Sydney time) that further quantitative easing was “certainly possible” to assist economic growth and to bring down unemployment from 9.8 per cent.

Data releases

AUD: RBA interest rate decision

NZD: No data today

JPY: Leading & Coincident index, Oct

GBP: Industrial Production, Oct

EUR: Factory Orders, Oct

USD: Consumer Credit, Oct

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