NZD 

In New Zealand yesterday the central bank increased its
interest rate from 2.5% to 2.75% becoming the first major developed nation to
do so, and signalled that it may remove stimulus faster than previously
forecast to contain inflation. The Reserve
Bank of New Zealand expects to raise the rate by about 2 percentage points over
two years, with the pace depending on economic data.

NZD 

In New Zealand yesterday the central bank increased its
interest rate from 2.5% to 2.75% becoming the first major developed nation to
do so, and signalled that it may remove stimulus faster than previously
forecast to contain inflation. The Reserve
Bank of New Zealand expects to raise the rate by about 2 percentage points over
two years, with the pace depending on economic data.

EUR

The only data out from Europe yesterday was industrial
production, with year on year data improving to 2.1% in comparison to a
forecast of 1.9% continuing the recent trend of good data out from the
Eurozone. The EUR continued to strengthen yesterday with EUR/USD climbing to a
new 2 ½ year high. 

Also yesterday George Soros (famous for speculating against
sterling) added his opinion on the Eurozone. He says that Europe faces 25 years of Japanese-style stagnation unless
politicians pursue further integration of the currency union and change
policies that have discouraged banks from lending.

Today

Further euro strength this morning with inflation in France rising
to 1.1% year on year from 0.8%, easing the deflationary fears around Europe.
Also Spanish retail sales figures came in much better than expected 0.5%
compared to forecast fall of -0.8%.

This afternoon the focus is on US data, retail sales are
meant to show an improvement from the previous month.

Mixed expectations from US employment data, with continuing jobless
claims set to fall slightly, but initial jobless claims set to rise.

Key Announcements:

9.00am – EUR – ECB Monthly Report

13.30pm – USD – Initial Jobless Claims: Expected to increase
to 330,000

13.30pm – USD – Retail Sales: Expected to increase to 0.2%