FX DAILY REPORT MONDAY 23 MAY 2011

Bell FX Currency Outlook Australian Dollar / US Dollar

The Australian Dollar has opened slightly lower this
morning following a sharp sell-off of the EUR on Friday
night. 1.15

1.05

Australia: Investors worries were further fuelled on Friday when Fitch 0.95
Ratings Agency slashed Greece’s credit rating by three notches to B+ due 0.85
the massive challenges it faces in order to correct the country’s financial
0.75
situation. The AUD traded within a 1 US cent range of USD1.0610-
0.65
USD1.0710, proving to be fairly resilient amid the EUR sell off and
negative news. Spot gold rallied on the back of safe haven buying, while 0.55
Aug-06 Aug-07 Aug-08 Aug-09 Aug-10 Aug-11
commodity prices posted some late gains following sell-offs earlier in the
week. In the absence of any significant data this week the AUD is likely to
be driven by offshore events. The recent trading range of USD1.0550-
Today’s Forecast Range
USD1.0700 is likely to prevail, however moves towards the topside might
be limited if the situation in Greece continues deteriorate. Not much in the
USD 1.0600– 1.0700
way of Australian data this week, with the main releases being Currencies Last High Low
construction work done and private capital expenditure data for Q1, both
AUD / USD 1.0625 1.0711 1.0610
of which will feed directly into Q1 GDP.
USD / JPY 81.64 82.23 81.47

Majors: European debt fears were in the spotlight Friday night sinking the EUR / USD 1.4100 1.4345 1.4109
EUR against most of the major currencies. It fell to a record low against GBP / USD 1.6215 1.6274 1.6140
the CHF as fears grew that Greece may need to restructure its debt. After NZD / USD 0.7935 0.7975 0.7862
scaling to near two-year peaks in early May on expectations of higher
interest rates in the euro-zone, the EUR has taken a dramatic fall on AUD Crosses Last High Low
Greece’s financial situation over the past week. As mentioned above, AUD / JPY 86.78 87.34 86.68
Friday’s downgrade to Greece’s credit rating added to investors worries.
AUD / EUR 0.7530 0.7539 0.7445
Standard & Poor’s also lowered its outlook on Italy to negative on Friday,
meaning that there is a 33% chance of a ratings downgrade in the next 24 AUD / GBP 0.6550 0.6586 0.6543
months. Spain has also come into the spotlight with some analysts viewing AUD / NZD 1.3385 1.3486 1.3340
its economy as vulnerable to upheaval in its banking sector and debt
AUD / CAD 1.0357 1.0401 1.0299
markets. Concerns were evident in a widening of the yield differentials
between Spanish and German benchmark debt Friday night. There is no Australian Rates Last Previous
major data being released offshore tonight. Official Cash 4.75
3 Month Bill 5.00 5.02

Economic Calendar 10 Year Bond 5.32 5.35

23 MAY CH HSBC Flash China Manufacturing PMI May US Rates Last Previous
US Chicago Fed Nat Activity Index APR Fed Funds 0.25
EU Various ECB Members Speak throughout Europe
3 Month Libor 0.258 0.259
CA Victoria Day Public Holiday
10 Year Bond 3.150 3.180
Commodities Last - / + (%)

Important Disclaimer – This may affect your legal rights: This publication has been issued on Gold (US$ / oz) 1512.30 1.3
the basis that it is only for the information and exclusive use of the particular person to whom it is Oil (WTI) US$/bbl) 100.10 1.7
provided by Bell Potter Securities Limited trading in the foreign exchange markets as Bell Foreign
Exchange (ACN 004 845 710). As this publication is a private communication to clients, it is not CRB Index 341.56 0.7
intended for public circulation or for use by any third party, without the prior approval of Bell Foreign
Exchange. The Information contained in this publication has been obtained from sources considered Equities Last - / + (%)
and believed to be both reliable and accurate, and no responsibility is accepted for any error or
omission, that may have occurred, or for any opinion expressed. The Information is general in ASX 200 4732 -0.5
nature, and does not take into account, the particular investment objectives or financial situation of Dow Jones 12512 -0.7
any potential reader. It does not constitute, and should not be relied on, as financial or investment
advice, or recommendations (expressed or implied), and is not an invitation to take up securities or FTSE 5948 -0.1
other financial products or services. No decision should be made on the basis of the information
without seeking expert financial advice. Ranges in this publication are indicative ranges over the Hang Seng 231199 0.2
past 24 hours. Last is around 9.00am Sydney. Please speak with Bell Foreign Exchange if you
require latest pricing and ranges. Nikkei 9607 -0.1

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