Antipodean Currencies Weaken Amid Risk-off Mood

(RTTNews) - The antipodean currencies such as the Australia and the New Zealand dollars weakened against their major currencies in the Asian session on Thursday, as Asian markets traded lower, with traders remaining cautious as the blockade of all maritime traffic entering and exiting Iranian ports and the Strait of Hormuz continues even as U.S. President Donald Trump extended the U.S. ceasefire with Iran indefinitely until Tehran submits a "unified proposal" to end the war.

The back and forth between Trump and Tehran has led to some uncertainty, although traders generally remain hopeful about an eventual resolution of the conflict.

The blockade on the Hormuz traffic continued to escalate inflationary pressures with energy experts warning about crude oil "demand destruction" due to stagflation.

In economic news, the manufacturing sector in Australia bounced back up into expansion territory, the latest survey from S&P Global showed on Thursday with a score of 51.0. That's up from 49.8 in March and it moves above the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that the services PMI improved to 50.3 from 46.3 in March and the composite PMI climbed to 50.1 from 46.6.

In the Asian trading today, the Australian dollar fell to more than a 1-month low of 1.6344 against the euro, from yesterday's closing value of 1.6355. If the aussie extends its downtrend, it is likely to find support around the 1.61 region.

Against the U.S. and the Canadian dollars, the aussie slid to 2-day lows of 0.7137 and 0.9759 from Wednesday's closing quotes of 0.7158 and 0.9784, respectively. The aussie may test support around 0.69 against the greenback and 0.96 against the loonie.

Against the yen, the aussie edged down to 113.85 from yesterday's closing value of 114.15. The next possible downside target for the aussie is seen around the 112.00 region.

The NZ dollar fell to 2-day lows of 0.5877 against the U.S. dollar and 93.75 against the yen, from yesterday's closing quotes of 0.5905 and 94.17, respectively. If the kiwi extends its downtrend, it is likely to find support around 0.57 against the greenback, 92.00 against the yen and 2.00 against the euro.

Against the Australian dollar, the kiwi edged down to 1.2150 from Wednesday's closing value of 1.2121. On the downside, 1.23 is seen as the next support level for the kiwi.

Looking ahead, PMI reports from European economies and U.K. for April, the European Central Bank (ECB) non-monetary policy meeting report and U.K. CBI business optimism index for the second quarter are slated for release in the European session.

In the New York session, Canada manufacturing sales data for March, PPI and raw materials prices for March and U.S. weekly jobless claims data, U.S. S&P Global PMI for April and U.S. Kansas Fed manufacturing index for April are due to be released.