Exchange rates today appear to be in a holding pattern as we await crucial Australian retail sales figures due at 11:30am. Economists are expecting a 0.2% increase in retail sales which would be well below the 0.9% posted the month previous. With recent moves by the RBA to cut interest rates, all eyes will be on this retail sales figure for any indication of whether the RBAs expansionary monetary policy is taking effect. The Aussie dollar is still well entrenched in the 0.98′s, while EUR/USD could not hold above 1.2500 and looks set for further declines.

In the U.S overnight, CB consumer confidence showed a decline coming in at 64.9, below last month and it’s worst reading since February. Overall consumer confidence is well below pre-GFC highs of 100+. U.S markets soared in overnight trade up around a percent as Americans clearly bought on the news Greek polls show a superior lead for the pro-bailout New Democracy party. J.P Morgan through out some interesting data that suggests a 1 basis point drop in the economy in Europe equates to a 0.7 basis point drop elsewhere.

Europe markets also seemed upbeat posting solid gains, with equities up between half and one percent. The worst performer was Spain, where banking stocks led the market down 2.3% amid concerns for the already troubled banking sector.

Aussie markets have started the session lower as China ruled out large scale stimulus, instead appearing to play the wait and see game and apply stimulus only where needed. Exchange rates today, particularly the Aussie dollar will likely tread water until retail sales at 11:30am. Exporters or importers with exposures would be wise to take risk off the table where possible ahead of this announcement, particularly given the jumpy nature of markets lately!