• The USD is trading mixed with the AUD down sharply, AUD was pressured by the RBA's surprise decision to hold overnight rates steady, GBP underperforms pressured by UK election polls which suggest the UK election may result in a hung parliament, a hung parliament will reduce the chance that the UK will address its budget deficit, GBP downside is limited by improving UK construction PMI, CHF supported by report of better than expected Swiss consumer sentiment, EUR trades higher as Greek default spreads narrow and producer prices post an unexpected rise, JPY drifts lower as risk appetite improves in reaction to the RBA rate decision and firmer equity market trade, CAD is trading higher supported by improving risk appetite, higher commodity prices and gains in cross trade to the AUD
• Focus turns to today's release of US pending home sales and auto sales
• RBA leaves rates unchanged at 3.75%, a 25bps rate hike was widely expected, RBA says the decision to hold rates steady was because of China's tightening, interest rates will be raised if the economy improves, December NAB business condition index was unchanged at 10, AUD lower
• Japan's January monetary base rose by 13.4%, Japan's banking minister Kamei urged the Post Bank to buy more U.S. Treasury and diversify holdings, JPY lower
• EU December PPI rose by 0.1%, German retail spending rose 0.8% in December, according to Nomura Poland's plans to cut its budget deficit could lead to adoption of the EUR by 2014, EUR higher
• UK Jan construction PMI improved to 48.6 from 47.1 last month, GBP mixed
• Swiss Q1 consumer sentiment at -7 compared to -14 last month, CHF higher
• Fed Senior Loan Officer survey says consumer lending picture has improved as a small fraction of banks have increased willingness to make consumer loans, the survey however says demand for consumer loans has dropped and credit conditions for commercial real estate loans remains tight with demand weakening
• Former Fed Chairman Volcker says that regulating proprietary trading will help reduce risk
• US equity markets set to open higher, European equities mixed, Nikkei closed 166 points higher

Upcoming Events

• US - Tuesday, December pending home sales will be released expected at 97.1 compared to 96 along with January auto sales
• CAN - Tuesday, no major economic data is due for release from Canada today

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