Australian Dollar:

The Australian Dollar continued its recent decline against its US Counterpart yesterday, dropping to its lowest level in six weeks. Following on from last week's decline of 2.6 percent, the Nations currency opens a full one and a half cents weaker this morning at a rate of 0.9827. Driving global equities lower, commodities and assets deemed to be riskier in nature were sold across the board as concerns were amplified overnight that US Lawmakers will fail to reach an agreement on budgetary cuts as there remains an alarmingly high level of disagreement within US Congress. Looking ahead this week, the focus out of both Europe and the US is likely to become increasingly political with US Deficit talks weakening the outlook for the US economy in the coming year

We expect a range today of 0.9750 - 0.9900

New Zealand Dollar:

The New Zealand Dollar fell to its lowest level in eight months overnight amid concerns that a US Sub- Committee formed to pass US$1.2 Trillion worth of budgetary cuts are likely to fail in their attempt to reach a unified decision. After initially trading as high as 0.7554 against its US Counterpart, the kiwi tracked global equities lower reaching an eventual low of 0.7447. With the Greenback also strengthening significantly overnight, the US Currency appears to be the major benefactor of investors move away from riskier asset holdings. Looking ahead today the kiwi opens this morning a full cent lower currently buying 74.70 US Cents

We expect a range today of 0.7430 - 0.7520

Great British Pound

UK Stocks fell yesterday for the sixth straight day as the Great British Pound opens lower against its US Counterpart this morning at a rate of 1.5639. Continuing the recent trend of political bickering, markets and global indices finished well down in overnight trade amid signs that US lawmakers will fail to agree on budget cuts. With a US Sub-Committee expected to announce it failure today, US debt talks are likely to compound the ongoing concerns surrounding Europe. In what can only be described as another session of momentum swings the Sterling opens stronger against a weaker Australian Dollar currently trading at a rate of 1.5906

We expect a range today of 1.5810 - 1.5990

Majors:

The Standard & Poor's 500 Index extended its significant decline of 3.8 percent last week, falling a further 2.1 overnight. Driving a global sell-off in risk assets, treasuries rose amid concerns that the US deficit-cutting subcommittee is most likely to say today that it failed to reach an agreement on US$1.2 Trillion in savings. With the subcommittee's inability to again find mutual ground, serious questions remain as to whether US Congress are able to put a solution ahead of collective differences, with the current disagreement showing distinct similarities to the debt ceiling debate of a few months ago. In currency movements overnight the US Dollar rallied against the Japanese Yen opening higher this morning at a rate of 76.935 whilst the EURO remained relatively steady losing around 30 basis points against the Greenback. Over the coming 24 hours US Budgetary Talks are likely to remain at the forefront of investors minds as European Bonds Yields drifted slightly higher again overnight.

Data releases

AUD: No Data Today

NZD: Visitor Arrivals m/m, Inflation Expectations q/q

JPY: No Data Today

GBP: Public Net Borrowing

EUR: Consumer Confidence

USD: Prelim GDP q/q, Prelim GDP Price Index q/q, Richmond Manufacturing Index, FOMC Meeting Minutes