Australian, NZ Dollars Drop As Risk Sentiment Deteriorates
October 28 2022 - 12:48AM
RTTF2
The Australian and NZ dollars slipped against their major
counterparts in the Asian session on Friday, as investors digested
mixed economic data and earnings reports and awaited the Federal
Reserve's monetary policy meeting for more clues about the pace of
tightening in the period ahead.
Overnight data showed that the U.S. economy rebounded strongly
in the third quarter, but it offered some evidence of a healthy
slowdown that could have a positive impact on fighting
inflation.
Although the Fed is expected to raise interest rate by 75 basis
points in November, the possibility of a 50 basis point move in the
subsequent meeting has risen.
Disappointing quarterly results from several big tech companies
pointed to the impact of hawkish stance by the Fed.
Oil prices fell amid rising coronavirus cases in China and
widening restrictions across the country.
Reversing from its previous highs of 0.6480 against the
greenback and 0.8765 against the loonie, the aussie dropped to
2-day lows of 0.6416 and 0.8730, respectively. The aussie is seen
finding support around 0.62 against the greenback and 0.86 against
the loonie.
The aussie touched 1.1013 against the kiwi, its lowest level
since August 17. If the aussie slides further, 1.06 is possibly
seen as its next support level.
The aussie was down against the euro, at 1.5512. Next key
support for the currency is seen around the 1.57 area.
The aussie eased to 94.25 against the yen, heading to pierce a
3-day low of 94.23 seen at 5:15 pm ET. On the downside, 92.00 is
likely seen as its next support level.
The kiwi fell to 0.5809 against the greenback and 1.7124 against
the euro, off its early multi-week highs of 0.5873 and 1.7009,
respectively. The kiwi is poised to find support around 0.55
against the greenback and 1.74 against the euro.
The kiwi retreated to 85.31 against the yen, after rising to a
4-day high of 86.13 in early deals. Should the kiwi drops further,
it may face support around the 80.5 level.
Looking ahead, Eurozone economic confidence index for October is
due in the European session.
German preliminary CPI for October is scheduled for release at
8:00 am ET.
Canada GDP data for August, University of Michigan's final
consumer sentiment index for October and pending home sales and
U.S. personal income and spending data for September will be
released in the New York session.
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