Pacific Rim currencies looking firm, Australian Dollar outlook remains challenging with key data points lying ahead

A look at the wholesale currency markets shows:

• The Australian Dollar converts into 0.9328 US Dollars; 0.1 pct higher than seen at last night's close.
• The Pound Sterling converts into 1.7058 Australian Dollars. The rate is 0.03 pct lower.
• The Pound converts into 1.9412 New Zealand Dollars; 0.2 pct lower.
• The New Zealand Dollar converts into 0.8192 USD; 0.25 pct lower.

Please Note: These are spot market quotes; your bank will affix a discretionary spread when offering a rate. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering more currency. Please learn more here.

The British Pound has come under pressure in the past half hour after UK inflation softened slightly. Investors will now be awaiting the release of the MPC Minutes tomorrow morning for further guidance on where to take GBP.

Despite today's uneventful RBA minutes (See below) the GBP/AUD will also continue to find support on fears that a further Aussie interest rate cut is indeed in the offing.

Aus, NZ Dollars face a busy data calendar

"The RBA minutes overnight, left the door open to more rate cuts. Leading indicators in Australia tonight are expected to weigh on the AUD, but the 0.93 area is likely to hold. In turn, a widening current account deficit in New Zealand tomorrow is unlikely to reverse the Kiwi dollar’s recent gains at around 0.82," says a morning currency briefing from UniCredit Bank.

Much-hyped RBA Minutes

The highlight of the Asian session was the much hyped release of the September RBA meeting minutes.

"The key take-away is the clear lack of a bias. For a majority of the year the RBA has an explicit easing bias. However these minutes seem to remove any clarity," says Mazen Salhab at Swissquote Research.

These minutes took a balanced approach stating “members agreed that the bank should, neither close off the possibility of reducing rates further, nor signal an imminent intention to reduce them.”

Then the board added that it would “continue to examine the data over the months ahead to assess whether monetary policy was appropriately configured.”

They also confirmed that the past rate cuts to historically low levels and weak AUD are providing a substantial degree of stimulus (witnessed in the housing markets).

"In our view while rates cuts are not forthcoming, the RBA is clearly worried about the slowing pace of CAPEX and further rate cuts remain an option to support growth," says Salhab.

New Zealand dollar and UK 'pound at war'

Regarding the Pound Sterling to New Zealand dollar exchange rate we hear from Sasha Nugent at Caxton FX who says:

"Sterling and the kiwi have been at war over the past week with positive news out of both economies preventing both currencies from maintaining gains."

Expect tomorrow's release of the September MPC Minutes to provide the next major salvo in the battle between GBP and NZD.