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Commodity Currencies Fall Amid Rising Risk Aversion

Commodity currencies such as the Australian, the New Zealand and the Canadian dollars weakened against their major counterparts in the Asian session on Friday, as investor sentiment dampened amid worries that U.S. president-elect Donald Trump's plans to cut taxes and spend on infrastructure might stoke inflation.

Meanwhile, the crude oil for December delivery is currently down by 0.13 percent or $44.53 per barrel. The crude oil prices fell after a report showed OPEC's oil production rose to record highs in October.

The International Energy Agency said OPEC crude output rose by a 230,000 barrels a day to a record high of 33.83 million barrels a day in October.

The IEA said OPEC faces a significant challenge in curbing production to meet levels discussed at a recent meeting in Algiers.

In economic news, data from Business NZ showed that the manufacturing sector in New Zealand continued to expand in October, albeit at a slower pace, with a Performance of Manufacturing Index score of 55.2. That's down sharply from 57.7.

Thursday, the Australian, the New Zealand and the Canadian dollars showed mixed trading against their major counterparts.

The Australian dollar rose against the euro and the yen, but fell against the U.S. dollar. The NZ dollar fell against the U.S. dollar, but held steady against the euro and the yen.

The Canadian dollar rose against the yen, and held steady against the U.S. dollar and the euro.

In the Asian trading, the Australian dollar fell to a 2-week low of 0.7560 against the U.S. dollar and a 9-day low of 1.0210 against the Canadian dollar, from yesterday's closing quotes of 0.7611 and 1.0251, respectively. If the aussie extends its downtrend, it is likely to find support around 0.74 against the greenback and 1.00 against the loonie.

Against the euro and the yen, the aussie dropped to 2-day lows of 1.4430 and 80.37 from yesterday's closing quotes of 1.4303 and 81.29, respectively. The aussie may test support near the 1.50 against the euro and 76.00 against the yen.

The aussie edged down to 1.0506 against the NZ dollar, from yesterday's closing value of 1.0552. The aussie may test support near the 1.03 region.

The NZ dollar fell to a 2-day low of 1.5164 against the euro, from yesterday's closing value of 1.5093. If the kiwi extends its downtrend, it is likely to find support around 1.57 against the euro and 0.70 against the greenback.

Against the U.S. dollar and the yen, the kiwi dropped to 0.7187 and 76.48 from yesterday's closing quotes of 0.7212 and 77.03, respectively. The kiwi may test support near the 72.00 region.

The Canadian dollar fell to 2-day lows of 1.3513 against the U.S. dollar and 1.4736 against the euro, from yesterday's closing quotes of 1.3469 and 1.4668, respectively. If the loonie extend its downtrend, it is likely to find support around 1.36 against the greenback and 1.53 against the euro.

Against the yen, the loonie dropped to 78.70 from yesterday's closing value of 79.29. The loonie may test support near the 74.00 region.

Looking ahead, the German final CPI data and wholesale price index, both for October, are due to be released in the pre-European session at 2:00 am ET.

At 4:30 am ET, U.K. construction output for September is slated for release.

At 9:00 am ET, Federal Reserve Governor Stanley Fischer is expected to speak about US monetary policy and the global economy at the 20th Annual Conference of the Central Bank of Chile in Santiago, via satellite.

In the New York session, U.S. University of Michigan's preliminary consumer sentiment index for November and U.S. Baker Hughes rig count data are set to be published.

At 10:50 am ET, Bank of Canada Governor Stephen Poloz is expected to participate in a panel discussion at the 20th Annual Conference of the Central Bank of Chile in Santiago.

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