Australian, NZ Dollars Lower Amid Rising Risk Aversion
The Australian and NZ dollars fell against their major
counterparts in the Asian session on Friday amid rising risk
aversion, as uncertainty about new U.S. fiscal stimulus and the
resurgence in coronavirus cases in Europe as well as the U.S.
stoked concerns about a global economic recovery.
An unexpected increase in U.S. weekly jobless claims also
weighed on the markets.
Rising virus cases in regions around the world could lead
governments to reimpose lockdowns to contain the outbreak.
U.S. Senate Majority Leader Mitch McConnell rejected the push
for higher coronavirus stimulus deal, hours after President Trump
told FOX Business he was willing to raise his spending offer above
the White House's current $1.8 trillion proposal.
On the Brexit front, U.K. chief Brexit negotiator David Frost
said on Thursday he was "surprised" and "disappointed" by the
European Union's position during negotiations in Brussels.
EU chief negotiator Michel Barnier told reporters that there
were "prospects" of a deal but he could not say that "we'll
necessarily get a deal."
Survey from BusinessNZ showed that New Zealand manufacturing
sector continued to expand in September, and at a faster rate, with
a Purchasing Managers Index score of 54.0.
That's up from 51.0 in August and it moves further above the
boom-or-bust line of 50 that separates expansion from
The aussie weakened to 0.7070 against the greenback and 74.39
against the yen, off its early highs of 0.7098 and 74.83,
respectively. The next possible support for the aussie is seen
around 0.68 against the greenback and 72.00 against the yen.
The aussie reversed from its prior highs of 1.6491 against the
euro, 0.9382 against the loonie and 1.0754 against the kiwi and
edged down to 1.6551, 0.9358 and 1.0729, respectively. The aussie
is poised to challenge support around 1.70 against the euro, 0.92
against the loonie and 1.06 against the kiwi.
The kiwi dropped to 0.6587 against the greenback, 69.31 against
the yen and 1.7766 against the euro, after rising to 0.6606, 69.63
and 1.7723, respectively in early deals. The kiwi may locate
support around 0.63 against the greenback, 66.00 against the yen
and 1.82 against the euro.
Looking ahead, Eurozone final consumer inflation for September
and trade data for August are due in the European session.
In the New York session, U.S. business inventories data for
August, retail sales and industrial production for September and
University of Michigan's preliminary consumer sentiment index for
October are set for release.