Australian Dollar:
An increase in new home sales of 3.4 percent in October combined with a surprise increase in private new capital expenditure saw the Australian dollar well supported during intraday trade yesterday. Touching highs of 1.0480 against its US Counterpart, 1.05 still remains an important level for the Aussie with a break higher not out of the question if opening levels above 1.05 are achieved. Whilst positive sentiment remained given a string of encouraging releases out of the US and broader Europe it was not enough to force the Australian dollar above intraday highs earlier witnessed. Looking ahead this evening Chinese Manufacturing data due out over the weekend will be key indicator as to whether the Aussie can track higher. Meanwhile this morning the higher yielding asset opens marginally lower that where it was this time yesterday at 1.0428.

We expect a range today of 1.0400 – 1.0460

New Zealand Dollar
The New Zealand dollar has continued to trade within its recent ranges over the past 24 hours as investors appear confused as to whether US Lawmakers will be able to avoid the fast approaching fiscal cliff. Whilst there is a general feeling that minimal progress has been there is also a general consensus that the seriousness of the situation is at least being appreciated. Touching highs of 0.8260 against its US Counterpart question marks of the US budget overshadowed an otherwise positive overnight session which showed the world’s largest economy grew at a rate of 2.7 percent in the third quarter this year. This morning sees the New Zealand dollar currently buying 82.25 US Cents.

We expect a range today of 0.8200 – 0.8260

Great British Pound:
In a statement made overnight Bank of England Governor Mervyn King signalled that UK Banks may need to build up additional capital to ensure risk weightings remain appropriate. Keeping in line with the cautious economic outlook held by the BOE such statements emphasise the need to have well capitalised banks to ensure financial stability. In what was an overall positive session overnight stronger data releases from the US and Europe helped the cause of the Great British Pound which hit highs of 1.6045 against its US Counterpart. Meanwhile this morning the Sterling opens stronger against the Greenback (1.6038) the Aussie (1.5375) and the Kiwi (1.9495).

We expect a range today of 1.5340 – 1.5410

Majors:
Despite the massive cloud which is the US Fiscal Cliff looming over markets sentiment remained pointed in the right direction overnight. In further signs that the US economy is finally starting to show signs of life US GDP came in on expectation growing by 2.7 percent in the third quarter. Adding to momentum US weekly unemployment claims as well as new homes sales all came in above forecast. Sending US Stocks higher the Greenback also rallied against a handful of its major counterparts including the Japanese Yen as it opens higher this morning at a rate of 82.07. With Greece finally taking a back seat (for now), investors were able to turn their attention elsewhere. In figures released overnight German unemployment climbed for an eight straight month in November as Europe’s flagship continues to be weighed down by the debt crisis. On the currency front after trading between a 24 hour range of (1.2940 – 1.3000) against its US Counterpart the Euro opens slightly higher this morning at 1.2972.

Data releases

AUD:
Private Sector Credit m/m

NZD: Building Consents m/m

JPY:
Household Spending y/y, Tokyo Core CPI y/y, Unemployment Rate

GBP: Gfk Consumer Sentiment

EUR:
German Retail Sales m/m, French consumer spending m/m, ECB President Mario Draghi Speaks, CPI Flash estimate y/y, Unemployment Rate

USD:
Core PCE Price Index m/m, Personal spending m/m, Chicago PMI, FOMC Member Stein Speaks