Australian dollar hit by dovish rate shift, sinks to one-month low on kiwi
SYDNEY: The Australian dollar was on track for steep weekly losses on Friday after soft jobs data prompted markets to scale back wagers on a fifth rate hike this year, sending the currency to a one-month low against the New Zealand dollar. The Aussie slipped 0.1% to $0.6917 after diving 0.7% overnight to a 15-week low of $0.6895. That broke key support at $0.6904, with bears targeting the June…
The Australian dollar experienced a sharp decline on Friday, hitting a one-month low against the New Zealand dollar due to softer-than-expected jobs data. The currency dropped 0.1% to $0.6917, falling 0.7% overnight to a 15-week low of $0.6895. This drop broke the key support level at $0.6904, with traders targeting the June low of $0.6867.
The Aussie is now on track for a weekly decline of 0.9%, having fallen over 4% from its peak of $0.7238 in early September. Meanwhile, the New Zealand dollar surged 0.1% to $0.5629, after climbing 0.5% the previous day to a high of $0.5634, and is expected to rise 0.3% weekly, ending a seven-week losing streak. The New Zealand Reserve Bank (RBNZ) is widely expected to raise interest rates for the third time this year in October, with a 86% probability according to swaps.
However, RBNZ's chief economist Paul Conway has stated that the next rate move remains uncertain. New Zealand's electronic retail card spending fell 0.4% in September, but higher fuel costs are driving up the cost of air travel and accommodation, highlighting the ongoing inflation challenge. Analysts at ANZ predict annual headline inflation in New Zealand to ease to 3.8% in the third quarter, but they expect non-tradable inflation to rise to 3.5%.
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