The Australian and New Zealand currencies struggled to make gains against the US dollar on Monday, as concerns about global growth weighed on risk assets ahead of bond auctions in Europe and an EU meeting later this week. The Australian dollar stalled at $1.0456 versus $1.0475 late in New York Friday, having clawed off a two-month low of $1.0336 set last week.
The kiwi dollar nudged lower to $0.8162, from $0.8180 in New York on Friday. But it was still well off last week's near two-month low of $0.8058. It has lost some of its shine after a poor showing of local data added to worries about the global growth outlook. Early buying from a Swiss bank sent the Aussie to a session high of $1.0493. Still, worries about a hard economic landing in China, Australia's single biggest export market, have soured the Aussie's outlook.
Commodity currencies also face risks from several events this week, including key economic data from Germany, bond auctions in Italy and a meeting of eurozone finance ministers. Italy is looking to raise up to 7.5 billion euros in the debt markets amid renewed pressure on peripheral eurozone debt sparked by fears of fiscal slippage. "It's a surprise (auction) result that will have an effect on the Aussie," said a trader at a European bank in Singapore.
"The $1.0300 level is going to be very pivotal if we are to see renewed weakness due to local or offshore data, while on the topside, there is room to move back to $1.0520," he added. The Aussie stumbled more than 1 percent last week, after a warning by global miner BHP Billiton of slowing Chinese demand for iron ore and surprisingly weak Chinese economic data added to concerns about Beijing's demand for Australian commodities. This week sees few offerings of top-tier Australian economic data.
Comments
Comments are closed for this article.