Australian Dollar
It was a familiar story for the Australian dollar last week which traded within a tight range of less one full US Cent against the greenback. Remaining well capped around the 1.0480 level mixed signals from the US where lawmakers remain in disagreement over several key spending and tax initiatives continue to plague a potential move higher above 1.05. On the lookout today markets are expected to receive a slight boost given Chinese PMI came in better than expected over the weekend. Increasing to 50.6 such readings are the highest seen in over 7 months as new orders and export demand out-paced forecast. Opening this morning at a rate of 1.0425 against its US Counterpart this week is shaping up as busy one given investors remain unsure as to whether the Reserve Bank of Australia will continue its recent easing circle when they meet tomorrow in an a interest rate decision.

We expect a range today of 1.0390 - 1.0460

New Zealand Dollar
The New Zealand continued to be dragged lower on Friday by a political environment within the US clearly not conductive to a rally in riskier backed assets. Given signs that President Barack Obama and top republicans remain at odds as to how best avert a series of spending increases and tax hikes its now becoming increasingly likely that Lawmakers will once again leave it to the very last minute in order to reach a deal. Keeping in mind the US has only just started to show consistent signs of progress the last thing it needs is for its government to drag the entire market through the mud which it was where headed unless an consensus can be sort. Touching highs of 0.8235 against its US Counterpart a over high this morning remains a distinct possibility given the better than expected Chinese PMI read which we saw over the weekend. Meanwhile this morning the New Zealand dollar does open weaker clinging to the 82 US Cents level

We expect a range today of 0.8180 - 0.8230

Great British Pound:
The Great British Pound struggled to find it feet on Friday weighed down by a string of poor data releases out of broader Europe as well ongoing political squabbles in the US. Losing more than half a cent from earlier highs of 1.6061 against its US Counterpart the Sterling failed to recover after Chancellor of the Exchequer George Osborne said its taking longer than planned to balance Britain’s finances. Hinting that an extension will be needed to eliminate the majority of the budget deficit, signs of a slower than expected recovery will only add to the difficulty of balancing the books. In what has been relatively ordinary session for the Sterling the Great British Pound opens weaker against the Australian dollar (1.5345) however stronger the New Zealand dollar (1.9509)

We expect a range today of 1.5310 - 1.5370

Majors:
US Stocks slid as did the US Dollar on Friday after House Speaker John Boehner, the top Republican in Congress was quoted as saying "There is a stalemate, let’s not kid ourselves". Whilst the rhetoric out of US has remained inconsistent, at best, a clear direction for the market will not be known until this issue is resolved with investors simply set to tread water until such a time. Whilst weaker against a handful of its major counterparties the Greenback in fact strengthened against the Japanese Yen on Friday. Opening this morning at a rate of 82.45, the Yen continues to be plagued by hints of further invention from the BOJ as National elections approach. Meanwhile jumping across to Europe and whilst many believe the worst may be over news flows and data releases out of the region on Friday were far from positive. Kick starting the session Ratings agency Moody downgraded both the ESM and ESFS hinting that the creditworthiness of Europe’s main rescue fund will be adversely affected by negative economic conditions throughout the region. Speaking of negative conditions unemployment throughout broader Europe remained frustratingly high on Friday at 11.7% whilst CPI estimates have prices set to rise by a respectable 2.2% over the coming 12 months. After touching lows the 1.2967 against its US Counterpart the Euro opens the new week slightly stronger at a rate of 1.2985

Data releases

AUD:
MI Inflation gauge m/m, Retail Sales m/m, ANZ Job Advertisements, Company operating profits q/q

NZD: No data today

JPY:
Capital Spending q/y, BOJ Gov Shirakawa speaks

GBP: Manufacturing PMI

EUR:
Spanish Manufacturing PMI, Italian Manufacturing PMI

USD:
ISM Manufacturing PMI