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Australian, NZ Dollars Fall On Delta Virus Worries

The Australian and NZ dollars depreciated in the European session on Monday, as concerns over the rising cases of the Delta variant of the COVID-19 in Asia, U.S. and Europe dampened risk sentiment.

Australia recorded its biggest daily rise in COVID-19 cases on Monday despite a lockdown in the country’s largest city Sydney.

Sydney registered 112 new infections on Monday with New South Wales Premier Gladys Berejiklian warning that lifting the lockdown in the city is highly unlikely at this stage.

New infections climbed in the U.S. to the most since mid-May on Saturday.

Anthony Fauci, the top U.S. infectious disease specialist, said “ideological rigidity” is preventing people from getting Covid-19 shots.

Investors adopted a cautious stance ahead of the release of U.S. inflation data and testimony by Federal Reserve Chair Jerome Powell due this week.

Data from the Australian Bureau of Statistics showed that Australia building permits fell a seasonally adjusted 7.1 percent on month in May – coming in at 20,163.

That matched expectations following the 5.7 percent decline in April.

The kiwi dropped to 0.6962 against the greenback, 76.65 against the yen and 1.7048 against the euro, off its prior 4-day highs of 0.7009, 77.25 and 1.6939, respectively. The kiwi is seen finding support around 0.68 against the greenback, 74.00 against the yen and 1.74 against the euro.

The kiwi slipped to a 6-day low of 1.0717 against the aussie, after having advanced to a 4-day high of 1.0669 at 5 pm ET. If the kiwi extends drop, 1.09 is seen as its next support level.

The aussie edged down to 0.7461 against the greenback, 1.5912 against the euro and 82.12 against the yen, following its previous high of 0.7493, session’s high of 1.5844 and a 4-day high of 82.59, respectively. The aussie is likely to face support around 0.72 against the greenback, 1.62 against the euro and 80.00 against the yen.

In contrast, the aussie bounced off to 0.9329 against the loonie, from a low of 0.9309 seen at 9:30 pm ET. The aussie is poised to challenge resistance around the 0.95 level.

Looking ahead, at 9:30 am ET, Federal Reserve Bank of New York President John Williams will deliver a speech about inflation at a webinar co-hosted by Bank of Israel and Centre for Economic Policy Research.

The material has been provided by InstaForex Company – www.instaforex.com