U.S. currency five-dollar bills
Sheets of former U.S. President Abraham Lincoln on the five-dollar bill currency are seen through a magnifying glass at the Bureau of Engraving and Printing in Washington March 26, 2015. Reuters/Gary Cameron

Bell FX Currency Outlook: The Australian dollar is slightly higher as the greenback weakened overnight and the AUD benefited from the release of some positive Chinese economic data.

Australia: The AUD is trading near USD 0.7700 and as stated in our headline, had a strong night, supported by trade data out of China, which was not as downbeat as anticipated with China’s trade surplus surging to US$59.49 bn in May (up from US$44.8 bn in April). This follows the AUD receiving a boost by softness in the US Dollar which retraced gains made after positive US non-farm payrolls figures were released on Friday. Looking ahead to the weak, the key local events are today’s NAB Business Survey, a speech from RBA Governor Stevens Wed, and Thursday’s Labour Force survey. Today’s we’ll also get April home loans data. Internationally, after yesterday’s China trade data, which showed export weakness moderating but the annual decline in import growth accelerating, the latter the more worrying development for Australia, we’ll get CPI data today and then the raft of monthly activity readings on Thursday.

Majors: Overnight we have had a change in tone from the US, with President Obama saying that Greece must pursue reforms to satisfy creditors. Previously US rhetoric, from Treasury Secretary Jack Lew and his colleagues, has been to the effect that EU leaders should go to any lengths to avoid a so-called ‘Graccident’. One potentially positive development is a wire comment that Greece and creditors are discussing extending the current Eurozone bailout, currently due to expire on June 30, until March 2016, though without it seems, much if any change in the conditionality Europe wants attached to any such extension. President Obama, attending the G7 Summit in southern Germany at the weekend, also went on record stating the strong USD is a problem. Following this, it has since been denied by the White House. No matter, after a brief retracement on the denial, the USD continued to trend lower, led by EUR/USD and which has just move back above 1.13 having fallen to below 1.11 on Friday.

Economic Calendar 09 JUN

  • AU Nab Business Confidence/Conditions May
  • AU Home Loans Apr
  • CH CPI, PPI May
  • US NFIB Small Business Optimism

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