AUDUSD: The RBA cut rates by 0.25 percentage points to 3.5% on June 6 but an unexpected jump in economic growth during the first three months of the year that was announced this week has raised the prospect that further cuts could be delayed amid signs that Australia’s mining boom remains strong.
For its part, the RBA has tried to play down the significance of the first quarter growth figure with Governor Glenn Stevens saying Friday that risks remain for the economy. The RBA has cut rates partly to take the heat out of the Australian dollar, help manufacturing industries outside mining and boost household spending, all areas that seen as weak links in the Pacific nation’s economy.
We expect a range for today in AUDUSD rate of 0.98300 to 0.9890
We set limit BUY order for AUDUSD at 0.9820
Stop loss at 0.9770
Target at 0.9880 and 0.9920
EURUSD: More clarity on how the euro area’s transitional and permanent rescue funds will disburse up to 100 billion euros of bank aid to Spain will come “soon,” the European commissioner for economic affairs told members of the European Parliament on Monday.
Until the ESM is ready to start disbursing assistance to Spain, the transitional European Financial Stability Facility is assumed to be the fund providing the bloodline to the Spanish banks that need it.
We expect a range for today in EURUSD rate of 1.2380 TO 1.2510
We set limit BUY for EURUSD at 1.2380
Stop loss at 1.2320
Target at 1.2470 and 1.2530
USDJPY: The U.S. trade deficit narrowed in April, as a sharp pullback in imports and exports to the euro zone suggested the region’s troubles are increasingly washing up on U.S. shores.
But a stronger-than-expected buildup in wholesale inventories despite higher sales suggests U.S. businesses are still trying to keep up with demand.
The U.S. deficit in international trade of goods and services decreased 4.9% to $50.06 billion from an upwardly revised $52.62 billion the month before, the Commerce Department said Friday. The March trade gap was originally reported as $51.83 billion.
We expect a range for today in USDJPY rate of 79.00 to 79.80
We set limit BUY for USDJPY at 79.10
Stop loss at 78.60
Target at 79.60 and 79.80
