Australia, NZ dollars stuck near multi-month lows as risk aversion bites
By Stella Qiu
SYDNEY, Nov 21 (Reuters) - The Australian and New Zealand dollars were pinned near multi-month lows on Friday after the long-delayed U.S. jobs data failed to revive hopes for a rate cut next month, sending global stocks into a tailspin.
Data showed overnight the U.S. economy added far more jobs than expected in September, but the unemployment rate ticked up. Markets now imply a 40% probability of a U.S. cut in December, up from 30% a day earlier, but still not enough to flip the coin on bets for a December move.
Wall Street tumbled as jitters over inflated tech stock prices returned, resulting in the Nasdaq's widest one-day swing since April 9. The risk-sensitive commodity currencies slid along with lower stocks.
The Aussie AUD= bounced 0.2% on Friday to $0.6450, after sliding 0.6% overnight to hit a three-month low of $0.6434. It is finding some support above $0.6440, and resistance is heavy at the 200-day moving average of $0.6460.
For the week, it is down 1.4%.
Tony Sycamore, analyst at IG, said the Australian dollar could rebound towards $0.6620 if it manages to stay above the current level.
"If the AUD/USD were to first see a sustained break of support at 0.6450/15ish, it would open the way for a deeper decline initially towards 0.6300," he said.
New Zealand's kiwi NZD= also rebounded 0.2% to $0.5597, having fallen 0.4% overnight to a fresh seven-month trough of $0.5582. There is little support until $0.5483, with the recent price actions - printing lower highs - bearish for its outlook.
For the week, it is 1.5% lower.
Next week is shaping up to be a big one for the kiwi as the Reserve Bank of New Zealand is widely expected to cut interest rates by another quarter-point to 2.25% on Wednesday.
That would be current Governor Christian Hawkesby's last policy meeting before new chief Anna Breman takes over from December. Swaps are implying there is a 7% risk that the RBNZ could surprise with another outsized 50 bp move like it did in October.
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