Australian, NZ Dollars Drop Amid Rising Risk Aversion
The Australian and NZ dollars fell against their major
counterparts in the Asian session on Monday, as possibility of
aggressive interest rate hikes by the U.S. Federal Reserve and a
tightening of COVID-19 restrictions in China's capital Beijing
triggered uncertainty about the global growth outlook.
Beijing had tightened restrictions amid a spike in infections,
which includes suspending dining-in services at restaurants and
requiring to show a negative Covid-19 test result to enter public
Investors focused on the Fed's monetary policy meeting due this
week, which is expected to deliver a 50 basis point rate hike to
In addition, the European Union is preparing a new raft of
sanctions against Russia, which could include a ban on Russian oil
The Reserve Bank of Australia is expected to raise its cash rate
by 15 basis points to 25 basis points at its meeting on
The aussie declined to 0.7032 against the greenback, its weakest
level since February 1. Against the yen, it reached a 4-day low of
91.52. The aussie is seen challenging support around 0.68 against
the greenback and 90.00 against the yen.
The aussie was down against the euro and the loonie, hitting a
1-week low of 1.4961 and near a 3-month low of 0.9049,
respectively. The aussie is likely to challenge support around 1.53
against the euro and 0.88 against the loonie.
The kiwi weakened to nearly a 2-year low of 0.6422 against the
greenback, while touching a 5-day low of 83.52 against the yen. The
next possible support for the kiwi is seen around 0.63 against the
greenback and 80.00 against the yen.
Against the euro, the kiwi broke the key 1.64 level and fell to
near a 2-month low of 1.6403. On the downside, 1.66 is likely seen
as its next support level.
The kiwi retraced its early gains against the aussie, reaching
as low as 1.0967. Next key support for the NZ currency is seen
around the 1.11 level.
Looking ahead, PMI reports from major European economies are due
in the European session.
U.S. ISM manufacturing PMI for April and construction spending
for March are set for release in the New York session.
NZD vs Yen (FX:NZDJPY)
From Jun 2022 to Jul 2022
NZD vs Yen (FX:NZDJPY)
From Jul 2021 to Jul 2022