SYDNEY: The Australian and New Zealand dollars were slightly weaker on Monday, nursing last week’s losses as global central bankers vowed to keep rates low defying pressure from markets’ interest rate projections amid surging inflation.
The Aussie was 0.09% weaker at $0.7393, having shed 1.6% last week.
The risk-sensitive currency has support at $0.7359 but soft commodity prices and a strong reading on US inflation later this week could tip it below $0.73, analysts said.
“The market continues to adjust to the RBA’s relatively dovish message, and there is likely to be a further shift in that direction given the global central bank messaging,” said Westpac’s strategists in a client note.
The kiwi dollar was stable at $0.7120, following a 0.7% dip last week. It has support around $0.7073 and faces resistance around $0.7178.
Both had suffered collateral damage from gains in the US currency when the Bank of England on Thursday skipped a chance to raise interest rates.
The Aussie has also been struggling with a dovish outlook from the Reserve Bank of Australia (RBA) last week, which it underlined on Friday in a quarterly economic update.
Commodity price weakness was also putting pressure on the antipodean currencies, analysts said.
Aluminium prices fell to their lowest in more than three months on Friday, while on Monday, the most-traded thermal coal futures contract on the Zhengzhou Commodity Exchange fell 3%.
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