Bell FX Currency Outlook:
The AUD has recovered from an overnight low of USD 1.0527, to currently be holding steady around USD 1.0600, despite risk aversion trading seen overnight as concerns over the European debt crisis surface once again.

Australia: The AUD started yesterday's local trading session above USD1.0600, but it didn't take long for the markets to digest news that Greece were still yet to come to an agreement with their private sector creditors.

This saw our local currency weaken over the trading session hitting a low of USD 1.0527 overnight. It has since recovered as news surfaced from the EU summit in Brussels that the leaders have agreed to a permanent bailout fund for the region. To be called the 'European Stability Mechanism', it will consist of EUR500bio and come into effect in July 2012.

Locally today we have the release of the NAB business survey for December. While we don't expect that this will have much of an effect on the AUD, it would be disappointing if an improvement isn't the result
given the interest rate cut by the RBA in December.

The AUD is looking a little under pressure, therefore it wouldn't be surprising if the markets did see it weaken slightly over the course of the day.

Majors: Data out of the US overnight was over looked, given the news out of Europe. The US personal income and spending data as well as manufacturing data were mainly positive.

Personal incomes for the region came in slightly higher than expected, but this isn't feeding back into the economy with spending decreasing. This gives the impression that the US citizens are still concerned about their economy and increasing their saving levels.

The Dallas manufacturing index recovered well from its December result, increasing to 15.3, up from -0.3. This gives a positive outlook for Wednesday's ISM manufacturing figures. Equity markets across both regions were weaker given the Greece agreement not being reached.

US equities were slightly lower with the S&P 500 down 0.4% and the DOW down 0.2%. Europe's markets were the same with Germany's DAX down 1% and the FTSE100 down 1.1%.

Economic Calendar
31 JAN AU NAB Business Conditions/Confidence
AU Private Sector Credit
US Consumer Credit
GE Employment data