Archived IMT (2010.08.23)

AUSTRALIAN ELECTION DEADLOCK is having no particular AUD impact after a brief pullback in early Asian trade. We know markets don't like uncertainty, but such a close race was widely anticipated. Despite Gillard's plan to reduce Rudd's proposed resources tax to 30% from 40%, the tax remains a drag for the large miners, and there's already talk of deflecting business overseas. The most likely outcome remains a coalition govt formed between Labour and the independents since to obtain the required 76 votes. M&A news from Europe helping to boost risk appetite, with AUDUSD seen capped at the 0.90 Aug 6 trendline resistance and AUDJPY facing resistance at 76.80.