SYDNEY: The Australian and New Zealand dollars were headed for their fifth week of losses on Friday as the spread of the Omicron variant clouded the outlook for global growth just as markets were pricing in a faster pace of US rate hikes.

The Aussie was pinned at $0.7081, having shed 0.5% for the week so far, but did manage to hold above the 13-month low of $0.7063 hit earlier in the week.

The next bear target is a trough from November 2020 at $0.6990, while major resistance is up at $0.7172.

The kiwi dollar was also down about 0.5% for the week at $0.6796, but again above the low of $0.6773. It has little in the way of support until $0.6700.

With the US Federal Reserve signalling a faster pace of tapering, the market is wondering how the Reserve Bank of Australia (RBA) might react at its policy meeting next week.

Most analysts assume it is too early for the RBA to change tack on its dovish outlook of no rate hikes in 2022, though there was some talk it might flag a cut in its bond buying.