Australian FOREX Daily Outlook 15/09/2006

CURRENCY TRADING SUMMARY –15 SEPTEMBER06 (05:00GMT)

• U.S. Dollar Trading (USD) was generally weaker against the major currencies in the overnight foreign exchange trading session as retail sales came in better than expected and the market prepares itself for the important G7 meetings over the weekend. US retail sales came in at 0.2%, better than the estimated -0.1%. However, Retail sales Ex-Autos came in at 0.2%, worse than the expected increase to 0.3%. Initial jobless claims impressed posting 308k for the week versus an estimated 315k. In other markets, the Dow Jones index fell by 15pts and the NASDAQ rose by 1pt amid inflationary concerns and its impact on consumer spending. Crude oil fell by US75c to US$63.22 a barrel as strikes at Nigerian terminals were suspended. Looking ahead, US CPI and industrial production are due out tonight.

• The Euro (EUR) traded within a low of 1.2676 and a high of 1.2752, before closing at 1.2724 in the New York session. Looking ahead, Eurozone HICP is due out today.

• The Japanese Yen (JPY) traded within a low of 117.31 and a high of 117.76 versus the dollar, before closing at 117.60 in the New York session. On the data front, the Tertiary index came in at -0.2 from a -0.1 estimate.

• The Sterling (GBP) traded within a low of 1.8757 and a high of 1.8918, before closing at 1.8863 in the New York session. On the data front, retail sales came in at 0.3% which was in line with expectation.

• The Australian Dollar (AUD) traded within a low of 0.7532 and a high of 0.7555, before closing at 0.7542 in the New York session.
• Gold (XAU) fell by US$10.30 to US$576 an ounce taking the lead from oil which was weaker overnight.

Initial support at 574.85 (76.4% retracement of the 543.50 to 676.35 advance) followed by 561.0 (Jun 20 low). Initial resistance is now at 595.41 (Sep 14 high) followed by 599.9 (Sep 12 high).