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Australian Dollar Down On Dismal Building Approvals, U.S. Data

The Australian dollar lost ground against other major currencies in the early Asian session on Thursday as traders sold riskier assets in response to economic reports showing slower growth in U.S. manufacturing activity and private sector employment.

Disappointing building approvals released by the country also exerted selling pressure on the aussie.

The data released by Automatic Data Processing revealed that private sector employment increased by 119,000 jobs in April, less than forecast for an increase of 155,000 jobs. The Institute for Supply Management said its purchasing managers index fell to 50.7 in April from 51.3 in March.

A report released by Australian Bureau of Statistics showed that building approvals in Australia fell to 5.5 percent on month in March following an increase of 3.1% in the preceding month.

A separate data showed that Australia's import price index stood flat in the first quarter after a 0.3% rise in the fourth quarter. Export price index rose to 2.8 percent on quarter, lower than forecast of 4.5 percent.

The aussie fell to an 8-day low of 1.0241 against the U.S. dollar, down 0.38 percent from Wednesday's close of 1.0280. The next downside target level for the aussie-greenback pair is seen around 1.02.

The Australian currency hit 1.0324 against the loonie, a level not seen since February 12. The next support area for the aussie-loonie pair lies around 1.025. The pair finished yesterday's deals at 1.0366.

The aussie declined to 1.2867 against the euro for the first time since February 28. The aussie thus depreciated 0.33 percent against the euro from Wednesday's closing quote of 1.2825. If the aussie falls further, it may eye support around 1.295 level.

The aussie reached more than a 2-week low of 99.65 against the yen, losing 0.35 percent from yesterday's close of 100.00. On the downside, 98.00 is seen as the next target level for the aussie-yen pair.

The aussie edged down to session's low of 1.2068 against the NZ dollar, not far from 3-1/2-year low of 1.2053 hit last week. The aussie may seek next downside target level around 1.19.

Looking ahead, PMIs from major European economies are due in the European session.

At 7:45 am ET, the European Central Bank will announce its interest rate decision. The central bank is forecast to slash rates to 0.50 percent from current level of 0.75 percent.

The U.S. weekly jobless claims for the week ended April 27 and trade data for March, as well as Canada trade data for March are likely to influence trading in the New York session.

by RTTNews Staff Writer

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