Archived IMT (2011.04.04)

Commodity FX remain hot ... Picking up where they left off last week, Australian and Canadian dollars continue to carve out new highs. AUD/USD tested a new multi-year high above $1.04 as USD/CAD extended its slide below C$0.9650 - new lows for the greenback against the loonie since late 2007. Both CAD and AUD will remain in focus on Monday. At 15:30 GMT (10:30am ET), the BANK OF CANADA releases its quarterly Business Outlook Survey. Last time, BOC saw businesses upbeat on sales growth, but also noted "inflation expectations are well anchored within the Banks range." Recall February Canadian core CPI missed on estimates but still registered a 4-month high at 0.2% m/m. A more hawkish outlook may begin to alter expectations for the conservative Canadian central bank - note the fixed income market is still pricing in below 10% chance of a rate hike at the next meeting. AUSTRALIA's ECON calendar is also busy. Consensus for the 2:30 am GMT Trade Balance sees a surplus of A$1.2B - this is well below January's A$1.9B and should further assess the impact of Dec-Jan floods on the mining industry. RBA rate decision is on tap 3 hours later at 4:30 am GMTon Tuesday. Overwhelming expectations see RBA standing pat at 4.75% - Gov Stevens may wait for late-April release of Australia's quarterly inflation data before altering RBA's perceivably neutral policy bias. Until then, we direct your attention to HSBC economists in Australian press highlighting steep wage growth in the mining industry in their assessment of the markets underestimating the pressure on RBA to resume raising rates.

US SIDE OF THE COIN is quiet on Monday in terms of economic data. Fed chief Bernanke to speak later in the day on clearinghouse regulations and Chicago Fed Pres Evans will discuss financial literacy - no mention of monetary policy expected release of FOMC meeting minutes on Tuesday looms as the next key US event. By GG. AshrafLaidi.com Staff.