Currency Alerts
11/25/2009 10:25 PM ET
(RTTNews) -
The Australian dollar lost ground in early Asian trading on Thursday after the government report showed that Australia's capital expenditure unexpectedly declined in the third quarter. The aussie plunged to a 6-day low against the currencies of Europe and Japan.
New capital spending by private businesses decreased a seasonally adjusted 3.9% quarter-on-quarter to A$26.55 billion in the third quarter, after rising a revised 2.1% in the second quarter, the Australian Bureau of Statistics reported today. Economists had expected capital expenditure to rise 1%.
On a yearly basis, total new capital expenditure declined a seasonally adjusted 1.3%. Expenditure on equipment, plant & machinery slumped 8.1%, while spending on buildings & structures grew 6.5%.
After opening on a bright note on the back of a positive close on Wall Street overnight, the Australian stock market drifted down into the red today, with participants cashing in on recent rallies and taking some profits in stocks cutting across various sectors.
The benchmark S&P/ASX 200 index, which fell to 4,708.8 from an early high of 4,751.3, is currently trading at 4,725, up 2.8 points or 0.1% over its previous close. The broader All Ordinaries index is up 2 points at 4,743. Earlier, after advancing to 4,768.1, it had tumbled to 4,729.6.
Among other markets in the Asia-Pacific region, Singapore, New Zealand, South Korea and Taiwan are trading higher, while Japan is down with a modest loss.
The Australian dollar reached a 6-day low of 80.73 against the Japanese yen by 10:00 pm ET and moving a few pips down may pull down the pair to its lowest level in more than 3-weeks. The aussie-yen pair that closed Wednesday's North American trading at 81.44 is presently quoted at 80.8.
The Bank of Japan's board members said that the global financial markets remain at risk amidst uncertain conditions, minutes from the October 30 monetary policy meeting revealed today.
The board added that the recovery for the U.S. economy is likely to lag behind the rest of the world, reiterating the need to take appropriate and flexible steps in a timely fashion.
At the meeting, the board unanimously decided to maintain the uncollateralized overnight call rate at 0.1 percent, as expected. Also, the board decided to stop outright purchases of commercial papers and corporate bonds at the end of 2009 as the central bank's assessment showed a marked improvement in conditions.
The Australian dollar that ended Wednesday's North American session at 0.9323 against the greenback drifted lower to 0.9246 by 9:30 pm ET. In near-term, the aussie-buck pair may find support around the 0.922 level.
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