Australian Dollar: The Aussie (1.0500) enjoyed a relatively positive day to open the new week yesterday with buyers coming out of the woodwork and taking the unit to an intraday high of 1.0430. A strong session on local equities buoyed sentiment and assisted in underpinning the currency.

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During the offshore session, there was very little in the way of economic data and the moves for the Australian Dollar were largely sentiment driven which saw a rally above US105 cents. Of particular import to investors will be today’s release of the RBA August policy meeting minutes which will provide further interest rate clues as markets continue to price in at least one cut over the remainder of 2011.

We expect a range today of 1.0440 – 1.0550

New Zealand Dollar: The New Zealand Dollar opens steady today against its US counterpart at 0.8320. The kiwi spent most of Monday in positive territory and moved to an intraday high of 0.8385 with support coming in the form of firmer equity markets which are recovering from three weeks of heavy losses.

During the offshore session, there was very little in the way of major economic data and the moves on the kiwi were being driven by risk appetite helping to push the unit to an overnight high of 0.8389. Against the Australian Dollar, the kiwi opens sharply lower on Tuesday at 0.7910.

We expect a range today of 0.8270 – 0.8380

Great Britain Pound: The Pound Sterling was still the benefactor from last Fridays stronger than expected US Retail Sales reading with the pair hovering above the 1.6250 level for the majority of the Asian session, despite a fair worse reading in the Rightmove HPI (House Price Index) coming in at a reading of -2.1% compared with a previous of -1.6%.

CABLE was stuck between 1.6250 and 1.6300 as a sense of calm and confidence returned to the markets following last week’s blood bath in global equity markets which saw billions of pounds wiped off market participants portfolios. Offshore, a tentative return into some risk assets pushed the pound to an overnight high of 1.6408. The calendar is fairly heavy data wise this week and it all starts with Tuesday CPI (expected to rise to 4.3%) and Thursday’s Retail Sales (expected to fall to 0.3%). Against the Australian and New Zealand Dollars, Pound Sterling is currently changing hands at 1.5580 and 1.9675.

We expect a range today of 1.5520 – 1.5610

Majors: In further signs that Global Markets are stabilizing following the US Credit Downgrading last week, the S&P 500 advanced 1.8 percent yesterday erasing all of its losses witnessed last week. While President Barrack Obama announced overnight that the political culture in Washington has only added to the large degree of uncertainty throughout financial markets of recent times, investors appear assured that the US Federal Reserve does have further bullets to fire should economic conditions continue to stagnant.

In Japan overnight a report showing GDP shrunk by 1.3 percent for the three months ended June 30 against an expected drop of 2.5 percent bolstered demand for the Nation’s Currency as investors shifted assets into higher-yielding currencies, the Greenback was sold against the Japanese Yen opening weaker this morning at a rate of 76.787. Meanwhile in Europe as Equities rallied the EURO advanced strongly from its early session low of 1.4266 to open two cents stronger this morning at a rate of 1.4446 against its US Counterpart.

Data Releases

AUD: Monetary Policy Meeting Minutes
NZD: No Data Today
JPY: No Data Today
GBP: CPI y/y, RPI y/y, DCLG HPI y/y, BOE Inflation Letter
EUR: Flash GDP q/q, Trade Balance