Monday morning in Asia, the Australian and the New Zealand dollars plummeted against their major counterparts as risk aversion increased amid growing concerns about credit woes in Europe.
The Aussie tumbled to a 1-week low against the kiwi, 11-day low against the greenback, 10-day low against the yen and 4-day lows against the euro and the loonie.
Meanwhile, the kiwi slumped to a 6-week low against the greenback and a 10-day low against the yen.
Tracking cues from Wall Street, where stocks suffered another setback on Friday amid concerns over the state of the European economy, Asian stocks opened lower today.
Japan’s Nikkei 225 index fell 2%, Hong Kong’s Hang Seng slipped 2.4%, China’s Shangai composite index dropped 2.4%, New Zealand’s NZX 50 index lost 0.3%, South Korea’s Kospi declined 2.5 % and Taiwan’s main index plunged 2.3%. Australia’s S&P 200 index and the All Ordinaries index was 2.6% lower each.
In economic news, the Australian Bureau of Statistics said today that housing finance for owner occupation, excluding alterations & additions, declined a seasonally adjusted 3.4% month-on-month in March to A$13.53 billion.
The Business New Zealand Performance of Services Index revealed today that the service sector in New Zealand posted its sixth straight month of expansion in April, posting a score of 54.1.
The Australian dollar fell against the US currency in early Asian deals on Monday. The aussie-greenback pair that closed last week’s trading at 0.8869 is currently trading at an 11-day low of 0.8754. The next downside target level for the Aussie is seen at 0.871.
During early Asian deals on Monday, the Australian dollar slipped against the euro. As of now, the aussie is trading at a 4-day low of 1.4054 per euro, compared to 1.3945 hit late New York Friday. If the Aussie falls further, it may likely target the 1.445 level.
The Aussie declined against the Canadian dollar in early Asian deals on Monday. At present, the aussie-loonie pair is trading at a 4-day low of 0.9118 with 0.908 seen as the next downside target level. The pair was worth 0.9159 at Friday’s close.
In early Asian deals on Monday, the Australian dollar dropped against the Japanese yen. Currently, the aussie-yen pair is trading at a 10-day low of 80.40, compared to last week’s closing value of 81.96. The next target level for the aussie is seen at 77.0, if it slides further.
The Aussie, which closed last week’s trading at 1.2556 against the New Zealand dollar weakened to a 1-week low of 1.2455 in early Monday Asian deals at 10:00 pm ET. If the aussie drops further, it may likely target the 1.241 level. The aussie-kiwi pair is now worth 1.2460.
During early Asian deals on Monday, the New Zealand dollar plunged against the currencies of US and Japan. At present, the kiwi is trading at a 6-week low of 0.6998 against the greenback and a 10-day low of 64.44 against the yen, compared to Friday’s close of 0.7071 and 65.35, respectively. The next downside target level for the NZ dollar is seen at 0.697 against the greenback and 61.9 against the yen.
Japanese core machinery orders rose 5.4% in March from a month earlier, the Cabinet Office said today. The result was the first gain in three months, and was also slightly better than the median forecast for a 5% rise. In February, core orders fell by a revised 3.8%.
According to a report from the Bank of Japan, an index measuring prices for domestic corporate goods was up 0.4% in April compared to the previous month, coming in at 103.0. That was slightly above forecasts for a 0.3% increase following the 0.2% monthly gain in March. On an annual basis, CGPI eased 0.2%, roughly in line with expectations for a 0.3% fall after the 1.3% decline in the previous month.
The New Zealand dollar edged down against the euro in early Monday Asian deals and hit a low of 1.7528 at 7:50 pm ET. Although the kiwi recovered thereafter, it pulled back again shortly and is currently worth 1.7520. On the downside, 1.775 is seen as the next target level for the NZ currency. The euro-kiwi pair closed Friday’s trading at 1.7482.
There are no significant economic reports due from Europe today.
Across the Atlantic, the U.S. empire manufacturing index for May, net long-term TIC flows for March and the NAHB housing market index for May are expected in the New York morning.