Australian, NZ Dollars Fall On Disappointing China Data

(RTTNews) - The Australian and NZ dollars dropped against their major counterparts in the Asian session on Monday, as China's industrial production and retail sales data came in below market expectations in July, in a sign that the Covid lockdowns and a downturn in the property market are clouding the economic growth.

Data from the National Bureau of Statistics showed that China's industrial production was up 3.8 percent on year in July - shy of expectations for an increase of 4.6 percent and down from 3.9 percent in June.

Retail sales rose 2.7 percent on year - missing expectations for 5.0 percent and down from 3.1 percent in the previous month.

Oil prices fell as disappointing economic data from China fuelled worries about the demand outlook.

In a surprise move, the People's Bank of China reduced the rate on its one-year policy loans by 10 basis points to 2.75 percent to support economic growth.

The aussie declined to 4-day lows of 0.7071 against the greenback and 94.23 against the yen, from its early highs of 0.7125 and 95.08, respectively. If the aussie drops further, 0.68 and 92.00 are possibly seen as its next support levels against the greenback and the yen, respectively.

Reversing from its early highs of 0.9103 against the loonie and 1.4394 against the euro, the aussie weakened to 0.9060 and 1.4478, respectively. Next key support for the aussie is seen around 0.88 against the loonie and 1.48 against the euro.

The kiwi dropped to 4-day lows of 0.6392 against the greenback and 85.23 against the yen, after rising to 0.6456 and 86.14, respectively earlier in the session. The kiwi is poised to find support around 0.62 against the greenback and 82.00 against the yen.

The kiwi pulled back from an early high of 1.5886 against the euro, with the pair trading at 1.6019. On the downside, 1.63 is likely seen as its next support level.

The kiwi was down at a 4-day low of 85.23 against the yen. The currency is seen finding support around the 82.00 level.

Looking ahead, Canada manufacturing and wholesale sales for June, as well as U.S. NAHB housing market index and New York Fed's empire manufacturing survey for August will be featured in the New York session.