Aussie dollar holds on to 68 US cents

Daily Currency Update

The Australian dollar is slightly weaker this morning when valued against the Greenback. The Aussie dollar recovered some ground on Thursday after falling to fresh February lows at US$0.6803, though it recovered some ground despite overall US dollar (USD) strength across the board. A risk-on impulse is another reason that it’s underpinning the Australian dollar (AUD). At the time of writing, the AUD/USD exchanges hands at 0.6810. NZD/AUD has sustained its move higher post-RBNZ and softer AU wage data earlier in the week, which saw a widening in NZ-AU yield differentials. NZD/AUD opens this morning just under 0.9150. There is nothing on the local calendar today. Offshore, Japanese inflation is expected to lift further. Keep an eye out for Ueda, the nominee to be the new Bank of Japan governor, as he testifies before the Diet.

Looking ahead next week and on Tuesday the Australian Bureau of Statistics will release the Retail Sales figures for the month. This is the earliest look at vital consumer spending data. It's the primary gauge of consumer spending, which accounts for the majority of overall economic activity. On Wednesday all eyes will be on the monthly Consumer Price Index (CPI). Consumer prices account for a majority of overall inflation. Inflation is important to currency valuation because rising prices lead the central bank to raise interest rates out of respect for their inflation containment mandate. On Wednesday we will also see the release of the Gross Domestic Product (GDP), the broadest measure of economic activity and the primary gauge of the economy's health. Finally on Friday we will see the release of monthly Building Approvals.