Australian Dollar
The Australian jobs market created 44,000 jobs in the month of March, smashing market expectations by a whopping 37,600 and hence allowing the unemployment rate to remain steady at 5.2%. Rallying 40 points on the announcement, the Australian dollar consolidated around 1.0350 before moving to session highs of 1.0380; an otherwise quiet Asian session allowing momentum to grab hold. Continuing the trend offshore the Aussie capitalised on Greenback weakness and stronger US equity markets to set its sights on 1.04 and above. Opening near 1.0440, market participants with a vested interest in the Aussie will be keeping a close eye on Chinese gross domestic product today with this release labelled to be the next potential market mover. Resistance has formed at 1.0440 and above this the next barrier lies around 1.0465/70.

We expect a range today of 1.0370 – 1.0470

New Zealand Dollar
Manufacturing in New Zealand expanded during March, it was reported by Business NZ yesterday, an index of 54.5 coming in comfortably above the 50.00 benchmark which signifies growth. With risk sentiment still showing signs of improvement and a rally in the Australian dollar pulling the antipodean region higher, the Kiwi moved up 0.4% to test levels near 0.8210 by late afternoon. Momentum continued into the European and North American sessions and an impressive rally was capped just shy of 0.8280. Holding its gains the New Zealand Dollar opens this morning against a weaker Greenback at 0.8270. Stellar employment figures, comparative to expectations at least, across the Tasman sent the New Zealand dollar lower against its Aussie counterpart, dropping to 79 cents during local hours but recovering to open this morning at 0.7930.

We expect a range today of 0.8220 – 0.8310

Great British Pound
An increase in risk sentiment in the markets and a weakening of the US Dollar following talk of potential quantitative easing sent Cable north yesterday, touching 10 day highs above 1.5970 by North American hours. Earlier in the session, a widening of the United Kingdom’s trade balance caused Sterling to stall around 1.5930 however the lure of risk appetite proved too strong for investors. Opening off highs this morning Cable sits at 1.5955 ahead of local PPI this evening. Looking at the cross rates, the Pound has predictably faltered against the Aussie and Kiwi in a risk-on environment and it opens at 1.5290 and 1.9275 respectively.

We expect a range today of 1.5200 – 1.5350

Majors
An increase in US unemployment claims sent the Dollar south overnight, the 380,000 gain adding to the lacklustre non-farm payrolls figure we saw last Friday. Subsequently speculation has mounted once more towards the possibility of further quantitative easing, a move that would see more US dollars injected into the economy thus serving to weaken the currency. Along with a 0.0% change in the producer price index and a 46 billion dollar trade deficit the Greenback dropped back towards 80.75 against the Japanese Yen after touching earlier highs near 81.10. Weakness in the mighty dollar also allowed the Euro to break 1.3200 briefly and the shared currency holds the majority of its recent gains this morning trading at 1.3185. Despite speculation of QE3, risk is back on the table this morning as equity markets close in the black and the aforementioned US trade deficit is an encouraging 6.5 billion dollars less than last month; Chinese GDP and a few key US releases this evening likely to drive the markets into the weekend.

Data releases:

AUD: No data due for release

NZD: REINZ HPI m/m

JPY: Monetary Policy Meeting Minutes

GBP: PPI Input m/m

EUR: German Final CPI m/m; Italian Industrial Production m/m

USD: Core CPI m/m; Prelim UoM Consumer Sentiment