Commodity currencies such as the Australian, the New Zealand and the Canadian dollars weakened against their major counterparts in the Asian session on Monday amid risk aversion, as the slowing Chinese economy deepened concerns over global growth. Mounting evidence that China is going through a rough economic patch has hit the global commodity and equity markets.
Weak corporate earnings and the fall in oil prices on renewed worries about China’s slowing economy also dented investor sentiment.
Meanwhile, Speaking at the Northern Club in Auckland, the Reserve Bank of New Zealand’s Deputy Governor Grant Spencer said that interest rate hikes in New Zealand are likely to be ‘off the table’ for the near-term despite rising house prices over the past year.
Last Friday, the Australia and the New Zealand dollars showed mixed trading against its major rivals. Against the U.S. dollar, the aussie held steady and the kiwi rose. The aussie and the kiwi fell against the yen and the euro.
Meanwhile, the Canadian dollar fell 0.13 percent against the U.S. dollar, 1.82 percent against the yen and 2.05 percent against the euro.
In Asian trading today, the Australian dollar fell to a 2-year low of 86.94 against the yen, more than 5-1/2-year low of 1.5956 against the euro and more than a 6-year low of 0.7199 against the U.S. dollar, from Friday’s closing quotes of 89.25, 1.5558 and 0.7308, respectively. If the aussie extends its downtrend, it is likely to find support around 86.00 against the yen, 1.59 against the euro and 0.71 against the greenback.
Against the Canadian dollar, the aussie dropped to 0.9524 from last week’s closing value of 0.9633. On the downside, 0.94 is seen as the next support level for the aussie.
Meanwhile, the aussie slipped to nearly a 4-week low of 1.0916 against the NZ dollar in the early Asian session, from Friday’s closing value of 1.0925, and held steady thereafter.
The NZ dollar fell to nearly a 4-year low of 0.7469 against the euro and nearly a 2-year low of 79.42 against the yen, from last week’s closing quotes of 0.7009 and 81.53, respectively. If the kiwi extends its downtrend, it is likely to find support around 0.76 against the euro and 79.00 against the yen.
Against the U.S. dollar, the kiwi dropped to a 5-day low of 0.6575 from Friday’s closing value of 0.6678. The kiwi may test support near the 0.65 region.
The Canadian dollar fell to an 11-year low of 1.3258 against the U.S. dollar, from last week’s closing value of 1.3179. The loonie may test support near the 1.33 region.
Against the yen and the euro, the loonie dropped to near 1-1/2-year lows of 91.07 and 1.5234 from Friday’s closing quotes of 92.51 and 1.5005, respectively. If the loonie extends its downtrend, it is likely to find support around 90.00 against the yen and 1.54 against the euro.
Meanwhile, the pound also fell against its most major rivals, and the Swiss franc rose on the safe haven status.
The pound fell to a 2-1/2-month low of 0.7330 against the euro, from Friday’s closing value of 0.7247. The pound may test support near the 0.74 region.
Against the Swiss franc and the yen, the pound dropped to near 1-1/2-month lows of 1.4694 and 189.32 from last week’s closing quotes of 0.4839 and 191.48, respectively. If the pound extends its downtrend, it is likely to find support around 1.45 against the franc and 185.00 against the yen.
The Swiss franc rose to more than a 3-week high of 129.00 against the yen, from Friday’s closing value of 128.98. On the upside, 131.00 is seen as the next resistance level for the franc.
Against the pound and the U.S. dollar, the franc advanced to nearly 1-1/2-month highs of 1.4693 and 0.9364 from last week’s closing quotes of 1.4839 and 0.9454, respectively. If the franc extends its uptrend, it is likely to find resistance around 1.46 against the pound and 0.92 against the greenback.
Looking ahead, Federal Reserve Bank of Atlanta President Dennis Lockhart is expected to speak at the 2015 Public Pension Funding Forum, in Berkeley, California.
The material has been provided by InstaForex Company – www.instaforex.com