In terms of overnight trading, it’s the Aussie that has caught the attention, with a push just shy of the 0.93 level on AUDUSD helped by data on private capital expenditure, with the move more triggered by the move towards 1.0950 on AUDNZD after the break above the previous high of 1.0912 which was offering pretty stiff resistance. If we break above the 1.0950, then AUDNZD will be pushing levels last seen the middle of December. Once again, the Aussie is pushing against developments in China which from some angles should be arguing for a weaker currency.
The other interesting currency, even though if not in the price action overnight, is sterling. The minutes to the latest MPC meeting last week showed that some members of the MPC were seeing the rate decision as being more finely balanced. There is an interview with one of them in the FT today (Martin Weale), who is one of these members. Although he argues that it is not so urgent that it needs doing now, but says that we can wait a bit longer, without defining longer. In summary, we are likely to see some members voting for a rate hike in the coming 2-3 months, something which is likely to be reflected in the currency at some point as well over that time.
For today, several European markets are shut for the Ascension day holiday, which will likely keep trading ranges tight. Watch for US GDP data later in the day, with expectations for this to be revised into negative territory for the first quarter, after the mere 0.1% annualised growth seen on the first estimate. The dollar will naturally be disappointed with anything weaker than the -0.5% expectation.