Forex: AUD/USD steadies above 1.0300

The Australian dollar has continued to weaken on Wednesday after the RBA meeting and extended losses against the greenback to a 3-month low.

After briefly falling below the 1.0300 level, the AUD/USD managed to stabilize above that mark. However, with the recovery capped by the 1.0320 area, the pair was confined to a narrow range where it has spent the last hours.

At time of writing, AUD/USD is trading around 1.0305/10, 0.7% below its opening price. On the downside, immediate supports are seen at 1.0295 (session low), 1.0260 (low Oct 24) and 1.0235 (low Oct 23). On the other hand, resistances could be found at 1.0320, 1.0345 (low Dec 26) and 1.0360 (intraday level).

Feb 6, 2013

Forex Flash: Market may fail to comprehend ECB's take on exchange rate - Commerzbank

Usually ECB President Mario Draghi dismisses talking about the euro exchange rate. However for tomorrow's press conference, Commerzbank can't exclude possible statements on the development of the euro exchange rate and the effects on growth and inflation as in the meeting last January. “In particular, they might reflect a view which was initially making the rounds as unconfirmed comments from ECB circles yesterday and which was then also taken up by the MPC member Erkki Liikanen: the stronger euro reflects the rising confidence in the euro zone and an improved fundamental position”, wrote analyst Carolin Hecht, pointing out that the exchange rate is influential for the euro zone economy but not the target of the ECB’s monetary policy, but unclear if the markets will make this small but important distinction tomorrow.

Forex Flash: Canadian PMI should pick up – Societe Generale

Kit Juckes, Global Head of Currency Strategy at Societe Generale notes that Canada releases the Ivey PMI for January this afternoon and the reading should pick up in line with the rise in the US index, and this may help the CAD at the margin.