Commodity Currencies Fall As China Industrial Profits Drop
28 October 2024 - 3:12PM
RTTF2
The Commodity currencies such as Australia, the New Zealand and
the Canadian dollars weakened against their major currencies in the
Asian session on Monday, after data showed that the Chinese
industrial profits slid in September.
Sunday, data from the National Bureau of Statistics showed that
the industrial profits at large Chinese companies dropped 27.1
percent from a year earlier in September, accelerating from a 17.8
percent slump for the previous month. Profits fell 3.5 percent in
the first nine months from the same period last year.
The third quarter saw China's GDP grow at its slowest rate since
early 2023, and while Beijing scrambles to boost growth, the
crisis-hit real estate market is not showing many signs of
stabilizing.
Increased deflationary pressures, slower export growth, and
muted loan demand were all noted in recent data, which raised
concerns about the economic recovery and reinforced the argument
for fiscal stimulus to spur development.
Oil prices were down nearly 5 percent in Asian trade after
Israel's retaliatory strike on Iran over the weekend bypassed
Tehran's oil and nuclear facilities.
The uncertainty about the outcome of the upcoming U.S.
presidential election and rising geopolitical tensions in the
Middle East are weighing on market sentiment.
The Fed is still widely expected to lower rates by a quarter
point next month, but CME Group's FedWatch Tool currently indicates
a 24.0 percent chance the central bank will leave rates unchanged
in December.
Traders will focus on Bank of Canada (BoC) Governor Macklem's
speech, due later in the day for fresh impetus.
In the Asian trading today, the Australian dollar fell to more
than a 1-month low of 1.6391 against the euro, from Friday's
closing value of 1.6341. The aussie may test support near the 1.65
region.
Against the U.S. and the Canadian dollars, the aussie slid to
nearly a 2-1/2-month low of 0.6579 and nearly a 1-1/2-month low of
0.9149 from last week's closing quotes of 0.6603 and 0.9172,
respectively. If the aussie extends its downtrend, it is likely to
find support around 0.64 against the greenback and 0.90 against the
loonie.
The aussie edged down to 1.1039 against the NZ dollar, from
Friday's closing value of 1.1046. On the downside, 1.09 is seen as
the next support levels for the aussie.
The NZ dollar fell to nearly a 3-month low of 0.5957 against the
U.S. dollar and more than a 2-month low of 1.8102 against the euro,
from Friday's closing quotes of 0.5977 and 1.8055, respectively.
The kiwi may test support near 0.57 against the greenback and 1.84
against the euro.
The Canadian dollars slid to nearly a 3-month low of 1.3907
against the U.S. dollar, from Friday's closing value of 1.3891. The
loonie is likely o find support around the 1.40 region.
The loonie edged down to 1.5007 against the euro, from last
week's closing value of 1.4993. On the downside, the loonie may
test support near 1.51 against the euro.
Looking ahead, Canada wholesale sales data for September and
U.S. Dallas Fed manufacturing business index for October are slated
for release in the New York session.
AUD vs US Dollar (FX:AUDUSD)
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