The Australian dollar edged lower against its major counterparts on Friday morning in Asia after the Reserve Bank of Australia Governor Glenn Stevens hinted that the prospect of fresh interest rate hike is not in the offing.
In a statement to the Australian parliament, Glenn Stevens said that the interest rates at the current level are just appropriate and hence the bank might not move on policy for some time. The Reserve Bank of Australia raised its cash rate by 25 basis points to 4.75% on November 2.
The Central Bank also believes that inflation will be close to current levels over the coming year.
On the equity front, the Australian stock market is trading modestly higher with investors indulging in some selective buying, tracking a fairly good show by European markets on Thursday.
However, amid a lack of cues from Wall Street as the U.S. market was closed overnight for Thanksgiving Day Holiday, investors are mostly seen treading cautiously at higher levels.
The benchmark S&P/ASX 200 index, which rose to 4,616.5 in early trades, is currently trading at 4,604, up 10.6 points or 0.2% over its previous close. The broader All Ordinaries index is up 11.8 points or 0.3% at 4,695.1.
Retreating from yesterday’s fresh record high, the Australian dollar slipped to a 2-day low of 1.3686 against the euro around 9:00 pm ET. The aussie is currently trading at 1.3669 against the euro and the domestic unit may test support around the 1.38 level.
Against the US dollar, the Australian currency reached a 2-day low of 0.9743 around 9:00 pm ET. The aussie-greenback pair is presently worth 0.9753 and a move below the key 0.97 support could set its lowest mark in nearly four weeks.
Extending its 3-day losing streak, the Australian dollar slumped to a fresh 7-week low of 0.9832 against the Canadian dollar by this time. The aussie-loonie pair is presently quoted at 0.9855 and the next downside target is likely to be seen around the 0.9780 level.
The Australian dollar reached at 81.62 against the Japanese yen around 9:00 am ET, down from yesterday’s 2-day high of 82.31. The aussie-yen pair is presently worth 81.80 with 81.10 seen as the next likely support level.
Japanese consumer prices fell for the 20th straight month in October although the pace of decline moderated sharply, official figures showed today.
The Ministry of Internal Affairs and Communications said core consumer prices, which exclude fresh food from the price basket, dropped 0.6% year-on-year last month, slowing sharply from the 1.1% fall in September. The C.P.I. came exactly in line with analyst expectations.
On a month-over-month basis, Japanese consumer prices rose 0.4%, following no change in September.
The Australian dollar depreciated by more than 1 percent to reach a 2-day low of 1.2821 against the NZ dollar on Friday morning in Asia from yesterday’s fresh 2-week high of 1.2955. The next downside target for the Australian currency
is seen around the 1.28 level.
Looking ahead, French consumer spending and eurozone M3 money supply-both for October are expected in the upcoming European session.
There are no market moving economic data due out in the North American session today.