Australian, New Zealand Dollars Drop On Virus Concerns
January 29 2020 - 9:32PM
RTTF2
The Australian and New Zealand dollars slipped against their
major counterparts in the Asian session on Thursday amid rising
risk aversion, as the death toll from the spread of the coronavirus
increased and the World Health Organisation said it would reconvene
today to decide whether to declare the risk of the outbreak a
global health emergency.
Some of the world's largest companies are curbing operations in
China and restricting travel to the region due to the
fast-spreading coronavirus. According to Chinese health officials,
the coronavirus outbreak has killed 170 people and infected 7,711
people.
On the economic front, the Australian Bureau of Statistics said
that export prices in Australia were down 5.2 percent on quarter,
but rose 4.1 percent on year in the fourth quarter of 2019. Import
prices were up 0.7 percent on quarter and 1.4 percent on year in
the quarter.
The aussie dropped to 0.6731 against the greenback, its lowest
since October 16. The next possible support for the aussie is seen
around the 0.625 level.
The aussie fell to 3-1/2-month lows of 73.27 against the yen and
1.6364 against the euro, off its early highs of 73.65 and 1.6295,
respectively. The aussie is seen finding support around 72.5
against the yen and 1.65 against the euro.
Reversing from an early high of 0.8915 against the loonie, the
aussie edged down to 0.8887. The aussie is likely to target support
around the 1.05 mark.
The kiwi dipped to near 2-month lows of 0.6505 against the
greenback and 70.81 against the yen, from its previous highs of
0.6530 and 71.20, respectively. If the kiwi extends decline, 0.63
and 67.00 are possibly seen as its next support levels against the
greenback and the yen, respectively.
The kiwi weakened to a 1-1/2-month low of 1.6933 against the
euro, following an advance to 1.6862 at 5:00 pm ET. The kiwi is
poised to target support around the 1.72 mark.
The kiwi ticked down to 1.0352 against the aussie, from a high
of 1.0332 seen at 7:30 pm ET. On the downside, 1.05 is possibly
seen as the next support level for the kiwi.
Looking ahead, Swiss KOF leading indicator and German jobless
rate for January, Eurozone jobless rate for December and economic
confidence index for January will be published in the European
session.
At 7:00 am ET, the Bank of England's interest rate decision is
scheduled for release. Economists widely expect the BoE to maintain
interest rate at 0.75 percent and asset-purchase program at GBP 435
billion.
German flash inflation for January is due at 8:00 am ET.
U.S. GDP data for the fourth quarter and weekly jobless claims
for the week ended January 25 will be featured in the New York
session.
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