The Australian dollar ended the week as one of the weakest currencies on the Forex market despite mild risk appetite, caused by hopes for a positive outcome in the Sino-US trade negotiations that were extended through the weekend.
Among negative factors weighing on the Aussie was the prediction by Westpac Banking Corporation of two interest rate cuts by the Reserve Bank of Australia this year. News that China banned Australian coal imports from Dalian, one of the biggest Chinese ports, also hurt the Australian dollar, though the currency bounced after China denied the report. Among positive fundamentals was robust growth of employment.
Prospect for interest rate cuts also hurt the New Zealand dollar. The announcement from the Reserve Bank of New Zealand of higher capital requirements for New Zealand’s biggest banks led to concerns about tighter financial conditions, which in turn can force the central bank to loosen its monetary policy further.
AUD/USD edged down from 0.7134 to 0.7123, touching the high of 0.7207 and the low of 0.7070 during the week. EUR/AUD gained from 1.5821 to 1.5893, and its weekly high was at 1.6019. AUD/NZD rallied from 1.0402 to 1.0489 during the week but retreated to 1.0400 by the weekend.
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Aussie Ends Week Among Weakest Currencies Despite Risk Appetite
