The Australian and New Zealand dollars declined against their most major currencies in the Asian session on Thursday as investors became cautious ahead of the European Central Bank meeting later in the day.
At its meeting in Frankfurt, the Governing Council led by ECB President Draghi is likely to reduce the main refinancing rate by 25 basis points to 0.75 percent. That will be a first in euro area monetary policy as the central bank has never before cut the rate below 1 percent.
The ECB announcement is due at 7.45 am ET and will be followed by the regular press briefing at 8.30 am ET.
A report from the Australian Bureau of Statistics showed that Australia posted a seasonally adjusted merchandise trade deficit of A$285 million in May.
That beat forecasts for a shortfall of A$500 million following the revised A$26 million deficit in April - which was originally reported as a A$203 million deficit
The aussie fell to a 6-day low of 1.0395 against the Canadian dollar and a 2-day low of 1.0252 against the US dollar, compared to Wednesday's close of 1.0416 and 1.0279, respectively. The next downside target level for the aussie is seen at 1.02 against the loonie and 1.035 against the greenback.
Against the euro, the aussie that ended yesterday's deals at 1.2193 slipped to as low as 1.2225. If the aussie slides further, it may target 1.225 level.
After rising to a new 1-month high of 82.30 against the yen in early Asian deals, the aussie retreated. The aussie-yen pair is now trading at 82.04, compared to Wednesday's close of 82.11.
Against the US dollar, the kiwi touched 0.8019 in a gap of 2 days and the next downside target level for the kiwi is seen at 0.80. The kiwi-greenback pair closed yesterday's deals at 0.8039.
The NZ currency is now trading at 64.15 against the yen, down from a 2-day high of 64.38 hit at 9:05 pm ET. The next downside target level for the kiwi is seen at 63.8. At Wednesday's close, the pair was quoted at 64.22.
The kiwi also declined against the euro, reaching as low as 1.5633 and the next downside target level for the kiwi is seen at 1.57. The pair finished yesterday's deals at 1.5592.
In the European session, U.K. Halifax house price index for June and German factory orders for May are due.
At 7:00 am ET, Bank of England's interest rate decision is due. The central bank is expected to retain interest rates at 0.50 percent.
The U.S. ADP employment data for June, weekly jobless claims for the week ended June 30 and ISM non-manufacturing composite index for June are set for release in the New York morning session.
by RTT Staff Writer
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