2013-03-04 07:55:23 Asian Session – Aussie drops to 8-mth low after domestic and China data
March 4, 2013 7:55 am
The Australian dollar fell to a seven month low against the dollar in Monday’s Asian session after a report showed building approvals unexpectedly declined, adding to speculation the Reserve Bank of Australia will cut interest rates this year.
Also weighing on the aussie was a disappointing data from China which showed the Purchasing Managers’ Index for services industries fell in January, recording the slowest expansion in five months. China is the largest trading partner for both Australia. PMI fell to 54.5 in February from 56.2 in January, adding to concerns that China’s rebound from a seven-quarter slowdown is losing momentum.
AUDUSD opened in Asia at $1.0198 and fell to a session low of $ 1.0115. Australia’s home-building approvals dropped for a second-straight month in January to 2.4 percent from December, when they fell a revised 1.7 percent. This was surprised economists who forecast a 2.8 percent gain.
The soft Chinese data dampened risk appetite, helping safe haven flows support yen. Investors generally seek shelter in the safer Japanese currency during times of market uncertainty or risk aversion.
Yen gained over 1 percent against the Australian dollar, with AUDUSD dropping from 95.50 to 94.42 yen during the session. USDJPY slid from 93.62 to 93.27 yen, while EURJPY drifted down to 121.30 yen.
The yen showed limited reaction to comments from Haruhiko Kuroda, the Japanese government’s nominee as the next Bank of Japan governor, when he spoke of more bond buying. Yen had been weakening recently due to expectations of bolder monetary policy measures to be undertaken especially after the nomination of Kuroda.
Euro remains steady against the dollar, trading in range since late Friday, between $1.3000 and $1.3030.
The Australian dollar fell to a seven month low against the dollar in Monday’s Asian session after a report showed building approvals unexpectedly declined, adding to speculation the Reserve Bank of Australia will cut interest rates this year.
Also weighing on the aussie was a disappointing data from China which showed the Purchasing Managers’ Index for services industries fell in January, recording the slowest expansion in five months. China is the largest trading partner for both Australia. PMI fell to 54.5 in February from 56.2 in January, adding to concerns that China’s rebound from a seven-quarter slowdown is losing momentum.
AUDUSD opened in Asia at $1.0198 and fell to a session low of $ 1.0115. Australia’s home-building approvals dropped for a second-straight month in January to 2.4 percent from December, when they fell a revised 1.7 percent. This was surprised economists who forecast a 2.8 percent gain.
The soft Chinese data dampened risk appetite, helping safe haven flows support yen. Investors generally seek shelter in the safer Japanese currency during times of market uncertainty or risk aversion.
Yen gained over 1 percent against the Australian dollar, with AUDUSD dropping from 95.50 to 94.42 yen during the session. USDJPY slid from 93.62 to 93.27 yen, while EURJPY drifted down to 121.30 yen.
The yen showed limited reaction to comments from Haruhiko Kuroda, the Japanese government’s nominee as the next Bank of Japan governor, when he spoke of more bond buying. Yen had been weakening recently due to expectations of bolder monetary policy measures to be undertaken especially after the nomination of Kuroda.
Euro remains steady against the dollar, trading in range since late Friday, between $1.3000 and $1.3030.
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