Australian Dollar: Australia's unemployment rate increased for the second month in a row, it was reported yesterday, edging up another 0.1% to 5.3%. Statistics showed 6,300 full-time jobs were lost from the workforce and the Australian Dollar lost 40 points off the back of the news. Falling to 1.0240 the Aussie used investor optimism to retrace its fall as markets remained hopeful in the lead up to the European session and the beginning of key meetings scheduled to take place. Such optimism resulted in a quick spike to levels near the 1.0350 mark before hopes were dampened by ECB president Mario Monti. Falling 2 full cents the Australian Dollar opens this morning at 1.0160 ahead of the second day of this weeks EU summit taking place in Brussels. Also of note is a basket of Chinese fundamental releases around midday, including their annualised Consumer Price index and Trade Balance figures on Saturday.

We expect a range today of 1.0100 - 1.0230

New Zealand Dollar: Market optimism helped the New Zealand Dollar improve upon small gains made in the wake of a more hawkish than expected RBNZ yesterday morning. The RBNZ left the cash rate unchanged at 2.5% and also announced that although the domestic demand is growing in a moderate pace, minor fluctuation in the NZ dollar is providing some support to the nation''s trade. Continuing higher throughout the local session, the Kiwi eventually spiked to levels around 0.7860 before risk appetite crumbled following the ECB meeting offshore. Retracing gains almost instantly, it fell to lows of 0.7720 where it opens this morning ahead of some key Chinese data and continuing meetings in the Eurozone. Movement on the cross rates was dominated by a spike higher after slightly weaker-than-expected AU employment data. It moved from 0.7590 to above 0.7610, before losing a little ground overnight to currently trade just below 0.7600.

We expect a range today of 0.7680 - 0.7790

Great British Pound: In a week of central bank meetings the Bank of England met for their monthly monetary policy decision yesterday, leaving interest rates at bench mark lows of 0.5% for the 33rd consecutive month. Its asset purchasing program was also left unchanged; the last change in this was an addition £75bn added at the October meeting. Sterling posted minor gains on the news however it was risk sentiment that dictated direction, after a move above 1.5750 disappointment from the ECB's press conference sent it falling to support at 1.5620. Opening just off these levels this morning the Pound has posted gains against its risk-sensitive counterparts, trading at 1.5370 against the Aussie and 2.0230 against the Kiwi.

We expect a range today of 1.5290 - 1.5420

Majors: Europe's Central Bank cut interest rates again this month , making it two for two for new ECB President Mario Monti. After lowering the minimum bid rate to 1.25% in November, another 25 basis points were cut again last night taking the banks rate to 1% in anticipation of the forecasted recession expected to result from wide spread austerity measures. Although the Euro's subsequent fall to levels below 1.3300 was more a reaction to Monti's re-clarification of what he meant by comments last week made in regards to 'other elements' involved in fiscal unity. He discouraged speculation the ECB would embark on a large-scale purchase of government bonds should leaders devise a way to work closer together. Also mentioning it would be illegal for the ECB to lend money to the IMF to buy euro zone bonds dampened the prospects of at least one strategy to weather the debt crisis and the 17-nation currency fell to lows of 1.3290. Opening this morning back at 1.3350 the pair will still be watching the final day of the summit in order to derive direction into the weekend. Not to overlook the world's largest economy, unemployment claims posted a better than expected decrease to 381,000 for the month of November, and following on from better than expected non-farm payrolls last Friday, this has helped the Greenback pare some previous losses gains against the Japanese Yen; they trade this morning at 77.70.

Data releases:

AUD: No data due for release

NZD: No data due for release

JPY: BSI Manufacturing Index; Final GDP q/q

GBP: PPI Input m/m; Trade Balance

EUR: German Trade Balance; French Industrial Production m/m

USD: Trade Balance; Prelim UoM Consumer Sentiment