SYDNEY/WELLINGTON: The Australian and New Zealand dollars eased from multi-month highs against the US dollar on Wednesday after China's manufacturing PMI disappointed a market already growing doubtful the Fed will do enough this week to bolster its economy.
Aussie trades at $1.0476, retreating from a four-month high of $1.0539 reached overnight. Immediate support seen around $1.0450, the low hit on Monday and the 23.6 pct retracement of the July 25-31 rally.
Kiwi around $0.8099, having pulled back from a three-month high of $0.8122 on Tuesday. Support seen at $0.8083, the 61.8 pct retracement of its February-June decline, while $0.8150 seen capping any significant upside.
Aussie lower vs kiwi at NZ$1.2936, hovering below a 5 1/2-month high around NZ$1.3080 hit in July.
China's official factory purchasing managers' index falls to an eight-month low of 50.1 in July, from 50.2 in June, suggesting the sector is barely growing. Forecasts had expected the index to edge up to 50.3.
China is Australia's single largest export market and developments there tend to affect the Aussie.
Aussie also softer against the euro, allowing the single currency to claw back from lifetime lows hit earlier this week. Kiwi holds ground on the euro, which remains within easy reach of a record low around NZ$1.5105 set Monday.
Antipodeans taking a breather from their winning streak in the past week, when the high-beta currencies had rallied on the chance the Fed and the European Central Bank may announce aggressive monetary easing measures.
Some analysts expect the Fed may pledge to keep official rates at essentially zero for longer, but stop short of more bond buying. That might disappoint the market and trigger selling in the euro, Aussie, and kiwi
Markets also holding their breath for ECB policy decision on Thursday, after ECB president lifted expectations last week by saying the bank will do all it takes to defend the euro.
Mixed bag of Australian data has little effect on the Aussie. House prices rose unexpected in the second quarter, while a measure of Australian manufacturing activity fell sharply as firms complained of a high currency and soft demand.
No major NZ data. A monthly business sentiment survey on Tuesday showed a marginal lift in headline confidence and firms' expectations about their own outlook, but offered nothing to alter interest rate expectations.
Market pricing implies largely no change in key rate over the next 12 months because of the euro zone debt crisis.
Australian bond futures flat, with the three-year contract unchanged at 97.480, while the 10-year contract rises just 0.005 points to 97.000.
NZ government bonds firmer, nudging yields 2.5 basis points lower across the board.
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