Australian FOREX Daily Outlook 22/06/2006

MARKET SUMMARY –22JUNE06 (05:00GMT)

• The Dollar was lower against the major currencies in the overnight session with any chance of a rise in the dollar hampered by comments from ECB president Trichet suggesting that interest rates will have to be pushed higher to fight inflation in the Euro zone and that “we’ll continue to do all that’s necessary to counter inflationary risks and anchor inflationary expectations.” In other markets, the Dow Jones finished stronger by 105pts, while the NASDAQ rose 34pts. Crude oil rose on the back of higher than expected gasoline inventory levels, finishing the session at US$70.33, up US99c a barrel. Looking ahead, durable goods orders are due out tomorrow.
  

• The Euro traded in a range of 1.2577 to 1.2677, before closing at 1.2660 in the New York session.
  

• The Japanese yen traded in a range of 114.38 to 115.22 versus the dollar, before closing at 114.89 in the New York session. On the data front, the trade balance came in at 383 billion yen right on expectations.
  

• The Sterling traded in a range of 1.8410 1.8473, before closing at 1.8460 in the New York session. On the data front, the minutes of the BoE meeting showed a 7-1 consensus amongst members to hold rates steady.
  

• The Aussie traded in a range of 0.7380 to 0.7395, before closing at 0.7395 in the New York session.

• Gold rose by US$10.50 to US$591.00 an ounce following a weaker dollar and strong crude oil price with base metals in general lifting in the overnight session.