Australian Dollar:

After an extended rally on Friday evening the Australian Dollar consolidated well in early morning trade reaching an eventual high of 1.0715 against its US Counterpart. Such advances above the 1.07 level were short-lived however with the Nations Currency being sold across the board throughout the afternoon reaching a 24 hour low of 1.0505. Driving the Aussie Dollar lower yesterday reflected the Bank of Japans decision to intervene in the currency market in an attempt to weaken the Yen as a stronger currency hurts the nations highly relied upon export industry. Following the intervention the Australian Dollar lost a full one and half cents, with the US Currency being the major benefactor. Looking ahead today, in what is shaping up as of one of the most highly anticipated interest-rate decisions in recent times; investors remain split as to whether The RBA will reduce the official cash rate from 4.75 percent with domestic price pressures ebbing of late.

We expect a range today of 1.0420 – 1.0600

New Zealand Dollar:

The New Zealand Dollar opens noticeably lower this morning currently buying 80.83 US Cents. In what was another busy session for the Kiwi, the Nation’s Currency traded as high as 0.8226 against its US Counterpart earlier in the day before Japans Central Bank stepped into the currency market in an attempt to weaken the Japanese Yen after it hit a fresh post World-War II high of 75.35 per US Dollar. With the US Dollar rallying considerably and the euphoria over Europe’s latest debt package starting the fade, attention is likely to remain on Central Banks this week with the US Federal Market Open Committee due to meet on Thursday to discuss the potential for further quantitative easing. Looking ahead today the 80 US Cents level is again likely to be tested with an interest rates decision expected out of Australia

We expect a range today of 0.8010 – 0.8140

Great British Pound

In what can only be described as a roller-coaster ride for the Great British Pound yesterday the Sterling opens around half a cent lower this morning currently trading at a rate of 1.6083 against its US Counterpart. With UK Stocks tumbling the most in five weeks, the FTSE 100 retreated 2.8 percent as investors nervously await the inner details of how Europe plan to fund its extended bailout facility. Looking ahead this week news flows out of Europe are again likely to dominant the short-term direction of the Sterling with G-20 members due to meet at a summit on Nov 3, it appears the initial rally witnessed throughout markets last week may of been a little overdone. Meanwhile this morning the Sterling opens stronger against a weaker Australian Dollar at a rate of 1.5253

We expect a range today of 1.5150 – 1.5350

Majors:

In Major news throughout currency markets yesterday Japan’s Central Bank stepped into sell the Japanese Yen, after the Yen hit a fresh post World-War II record of 75.35 per US Dollar. With the US Dollar being the major benefactor, Japans interventions are expected to continue in the coming months with a historically high Yen harming the competitiveness of the nation’s exporters. In unrelated news overnight global equities lost between 1.5 – 2.5 percent with investors becoming increasingly frustrated that further details regarding Europe’s latest debt package are not-forthcoming. With concern growing that European Leaders will struggle to raise the funds to contain the regions debt problems the EURO traded as low as 1.3827 against its US Counterpart, opening this morning a full 3 cents lower from its earlier highs at a rate of 1.3827. Looking ahead this week volatilities are expected to continue , with last weeks optimism and subsequent rally appearing to be of overshot the mark, the buying stampede looks contained in the short-term with further details required to outline exactly how Europe plan to finance their latest debt-resolution proposal.

Data releases

AUD RBA Cash Rate Decision, AIG Manufacturing, HIA New Home Sales m/m, Commodity Prices y/y

NZD: ANZ Commodity Prices m/m

JPY: Monetary Policy Meeting Minutes, Average Cash Earnings y/y, BOJ Gov Shirakawa Speaks,

GBP: Halifax HPI m/m, Manufacturing PMI, Prelim GDP q/q, Index of Services 3m/3m

EUR: French and Italian Bank Holiday

USD: ISM Manufacturing PMI, Construction Spending m/m, ISM Manufacturing Price