The Australian dollar fell below USD0.7500 overnight for the first time since November 2004. After closing at 0.7540, the local dollar came under strong selling pressure reaching 0.7476. This morning the Aussie continued to trade under 75 cents at 0.7490.

In a mixed night against the other majors, the AUD lost ground to the pound, yen, swiss and Canadian dollar, stayed steady against the euro and made small gains against the kiwi.
In Europe overnight, the Dutch voted 63% against the proposed European Union Constitution. The treaty was knocked back by the French over the weekend which led to heavy EUR selling both Monday and Tuesday. The Dutch decision now throws more fuel to the first of uncertainty in the region sending their local unit even lower.

Locally, the Australian GDP figures were released yesterday, Q1 growth came in at 0.7% below most market forecasts at 0.9%. The result followed disappointing Current account and Retail Sales figures and almost confirms the slowdown of the economy.

Foreign currency markets took the news in their stride, trading sideways all day despite the poor result. Euro trading continued to dominate the market. With a strong correlation between the EUR and the AUD, local traders seemed more interested in overseas developments than local data results.

Trade Balance figures will be released today under heavy downside conditions. Another disappointing result could exacerbate the AUD bear run and test 0.7450. Overnight, EUR/USD trade will continue to dominate proceeding with more euro dollar selling expected.