Australia's NAB Business Conditions index for December came out at +4 -vs- the -3 it posted in November while Business Confidence remained unchanged at +6. The Employment component rose to -4 from the -8 reading in November. Aussie, which had been trading around 0.8730, spiked higher as it broke through the overnight highs before running out of steam around 0.8770. The rise in business conditions may imply that domestic demand is starting to pick up which, if true, would likely signal that the RBA's easing phase is at an end.
The main event for the week is the FOMC announcement, the last with Bernanke as Chairman, that is due out on Wednesday and the question that is most pressing for the market is whether the FED will continue the tapering process that they initiated last month. The consensus amongst economists appears to be that, the anemic NFP report notwithstanding, the US economy's progress is such that the FED is almost bound to continue the reduction in asset purchases if for no other reason than to not do so would severely damage their credibility, an outcome that is anathema to any self respecting central banker.