The Australian and NZ dollars weakened against their major counterparts in the Asian session on Monday, as inflationary concerns and the prospects of monetary policy tightening by the Federal Reserve deteriorated risk sentiment.

U.S. treasury yields rose ahead of the Fed decision due on Wednesday.

The central bank is expected to deliver a quarter-point rate hike to combat soaring inflation.

China imposed a lockdown in Shenzhen due to a rise in COVID-19 cases.

The country's new daily cases doubled to nearly 3,400 over the weekend, driven by the highly transmissible Omicron variant.

High-level talks between U.S. and Chinese officials are scheduled in Rome, which will focus on bilateral relations and international and regional issues.

The aussie declined to near 2-week lows of 0.7238 against the greenback and 0.9253 against the loonie, reversing from its early highs of 0.7299 and 0.9294, respectively. The aussie may find support around 0.70 against the greenback and 0.90 against the loonie.

Reversing from its early highs of 85.82 against the yen and 1.0717 against the kiwi, the aussie dropped to a 4-day low of 85.25 and a 5-day low 1.0676, respectively. The aussie is poised to challenge support around 81.00 against the yen and 1.045 against the kiwi.

The aussie weakened to 1.5073 against the euro, from a high of 1.4957 hit at 6 pm ET. The aussie is seen finding support around the 1.53 mark.

The kiwi depreciated to 0.6778 against the greenback, its lowest level since March 4. On the downside, 0.66 is possibly seen as the next support level for the currency.

The kiwi retreated from a prior high of 1.6022 against the euro, reaching as low as 1.6099. The kiwi is likely to challenge support around the 1.62 mark.

The kiwi was trading at 79.82 against the yen, slightly down from a high of 80.10 seen earlier in the session. If the kiwi falls further, 76.00 is likely seen as its next support level.

NZD vs Yen (FX:NZDJPY)
Forex Chart
From Jun 2022 to Jul 2022 Click Here for more NZD vs Yen Charts.
NZD vs Yen (FX:NZDJPY)
Forex Chart
From Jul 2021 to Jul 2022 Click Here for more NZD vs Yen Charts.