AUD
The Australian dollar trended downwards against the USD as the bulls of the equity markets were tamed and risk appetite pared back. The strength of the European recovery was called into question, whilst announcements in China had a negative impact on the local currency.

The AUD rebounded on Monday due to speculation about the re-appointment of Federal Reserve Chairman Ben S. Bernanke. Despite a better than expected CPI figure (0.5%), the local currency performed poorly on Tuesday due to commentary from officials in China stating that they would rein in bank lending. The European Commission gave a scathing assessment of the economic environment in Portugal and Greece, noting that both countries had not done enough to rein in their budget deficits.

The AUD recovered slightly in Thursday’s overnight trade when US President Barack Obama announced tax cuts. The markets had been left in a precarious position a week earlier after the US President’s comments about reforms to the proprietary trading, private-equity and hedge fund activities of the banks there. Despite strong economic data from the US on Friday, notably GDP (5.7%) and Real Personal Consumption Expenditures (2.0%) on Friday, the AUD continued to weaken to close the week, in line with heavy falls on Wall Street.

**The RBA surprised the market by keeping interest rates (3.75%) on hold today. The AUD was significantly weakened as a result**

The week ahead in Australia:
Monday 1st – ANZ Job Advertisements, House Price Index, RBA Commodity Index SDR.
Tuesday 2nd  – NAB Business Confidence, RBA Interest Rate Decision, AiG Performance of Services Index.
Wednesday 3rd – Trade Balance.
Thursday 4th  – Building Permits, RBA Monetary Policy Statement, AiG Performance of Construction Index.

AUDUSD
The pairing performed poorly last week, opening at 0.9013 and tracking downwards for most of the week, to close at 0.88890.

The week ahead in the US:
Monday 1st – Personal Income, Core Personal Consumption Expenditure, Construction Spending, ISM Manufacturing.
Tuesday 2nd – Pending Home Sales, API Crude Oil Inventories, ABC/Washington Post Consumer Confidence.
Wednesday 3rd – MBA Mortgage Applications, ADP Employment Change, ISM Non-Manufacturing, EIA Cruude Oil Stocks Change.
Thursday 4th – Continuing Jobless Claims, Initial Jobless Claims, Nonfarm Productivity, Unit Labor Costs, Factory Orders.
Friday 5th – Average Hourly Earning, Nonfarm Payrolls, Unemployment Rate, Consumer Credit.

AUDGBP
The pairing opened at 0.5593 and tracked downwards from overnight trade on Monday to close the week at 0.5514.

The week ahead in the UK:
Monday 1st – Hometrack Housing Prices, M4 Money Supply, Net Lending to Individuals, Mortgage Approvals, PMI Manufacturing.
Tuesday 2nd – PMI Construction.
Wednesday 3rd – Nationwide Consumer Confidence, PMI Services.
Thursday 4th BoE Interest Rate Decision.
Friday 5th – Halifax House Prices.

AUDEUR
The pairing was relatively stagnant last week, opening last week at 0.6362 and after reaching a peak on Thursday at 0.6432 closed the week at 0.6379.

The week ahead in the Eurozone:
Monday 1st – PMI Manufacturing (Germany).
Tuesday 2nd – Retail Sales (Germany).
Wednesday 3rd – PMI Services (Germany), PMI Services, Retail Sales.
Thursday 4th Factory Orders (Germany), ECB Interest Rate Decision.
Friday 5th – Halifax House Prices.

NZD
The New Zealand dollar was weakened leading into last week by comments from Barack Obama which had a particular impact on currencies connected to risk appetite. Interest rate increase speculation continued to weaken after John Key moved to withdraw fiscal stimulus and the Interest Rate (2.5%) decision to keep rates on hold reflected this. RBNZ Governor Alan Bollard said that it is likely the central bank will “begin removing policy stimulus around the middle of 2010”.

China’s announcement that it would curb bank lending and put downward pressure on interest rates affected the so-called Kiwi and the comments about Greece and Portugal’s fiscal budget deficits curbed risk appetite. Importantly Building Permits (-2.4%) were significantly lower than expected however the Trade Balance Deficit (2m) was tightened as imports lagged.

The week ahead in NZ:
Monday 1st – ANZ Commodity Price.
Tuesday 2nd – Unemployment Rate, Visitor Arrivals.

AUDNZD
The pairing opened at 1.2650 and remained stagnant throughout the week, closing at 1.2634.

GBPNZD
The GBP strengthened against the so-called Kiwi for most of last week, opening at 2.2577 and closing the week at 2.2869.
 
EURNZD
There was significant volatility with this pairing, opening the week at 1.9850 and closing the week at 1.9755 after reaching a high of 2.0000 levels on Tuesday night.

NZDUSD
The pairing weakened for most of last week, opening at 0.7112 before spiking to 0.7164 only to close the week 0.7026.