Commodity Currency's Slide As Trump Unveils Tariff Plans

(RTTNews) - The commodity currencies such as Australia, the New Zealand and the Canadian dollars weakened against their major currencies in the Asian session on Thursday, after U.S. President Donald Trump announced steeper-than-expected reciprocal tariffs on U.S. trade partners, heightening concerns over a global trade war that could destabilize major economies. White House press secretary Karoline Leavitt indicated the new levies will be "effective immediately."

Trump imposed an additional 34 percent tariff on Chinese imports, raising total levies in China to 54 percent. Australia was hit with a 10 percent tariff, Japan was struck with a 24 percent tariff, alongside the 25 percent levies on auto and auto parts imports, dealing a heavy blow to Japan's auto industry.

In economic news, data from S&P Global showed that China's service sector growth accelerated to a three month-high in March on rising business activity and new orders. The Caixin services Purchasing Managers' Index logged 51.9 in March compared to 51.4 in February. The services sector in Australia continued to expand in March, and at a faster rate, the latest survey from S&P Global revealed, with a services PMI score of 51.6. That's up from 50.8 in February.

In the Asian trading today, the Australian dollar fell to nearly a 2-week low of 1.0926 against the NZ dollar, from yesterday's closing value of 1.0939.The aussie may test support near the 1.07 region.

Against the yen and the euro, the aussie dropped to more than 3-week lows of 92.29 and 1.7414 from Wednesday's closing quotes of 92.63 and 1.7408, respectively. If the aussie extends its downtrend, it is likely to find support around 0.60 against the greenback and 90.00 against the yen. The aussie edged down to 0.6256 against the U.S. dollar, from yesterday's closing value of 0.6264. On the downside, 1.75 is seen as the next support level for the aussie.

The NZ dollar fell to nearly a 3-week low of 84.40 against the yen and a 2-day low of 1.9049 against the euro, from yesterday's closing quotes of 84.69 and 1.9042, respectively. If the kiwi extends its downtrend, it is likely to find support around 83.00 against the yen and 1.92 against the euro.

Against the U.S. dollar, the kiwi edged down to 0.5720 from Wednesday's closing value of 0.5727. The next possible downside target for the kiwi is seen around the 0.55 region.

The Canadian dollar fell to a 2-day low of 1.5587 against the euro and nearly a 3-week low of 103.30 against the yen, from yesterday's closing quotes of 1.5501 and 104.03, respectively. If the loonie extends its downtrend, it is likely to find support around 1.59 against the euro and 101.00 against the yen.

Against the Australian dollar, the loonie edged down to 0.8957 from Wednesday's closing value of 0.8905. The loonie is likely to find its next support level around the 0.91 region.

Looking ahead, Eurostat is set to release euro area producer prices for February at 5:00 am ET in the European session. Prices are forecast to grow 0.3 percent on month, following a 0.8 percent rise in January .

At 7:30 am ET, the European Central Bank publishes the account of the governing council meeting held on March 5 and 6.

In the New York session, Canada and U.S. trade data for February, U.S. weekly jobless claims data, U.S. and Canada S&P Global PMI data for March, are slated for release.