The Australian and New Zealand dollars languished at multi-week lows on Friday as the greenback strengthened on rising expectations the US Federal Reserve will hike interest rates as early as this month. The Australian dollar slipped 0.3 percent to $0.7555, a level not seen since January 31. The Aussie is down 1.4 percent this week so far and is set for its worst weekly performance since mid-December. In contrast, the US dollar index is set for its best week since late 2016.
The Aussie traded in a $0.7605/0.7731 range for all of February, with strong chart support at $0.7600. Technical analysts say that support was broken in a burst of selling during European trading on Thursday, triggering a series of stop losses. The Aussie was also pressured by weak commodity prices with aluminium, oil and gold all falling.
Elsewhere, the Aussie continued its losing streak. It fell 0.3 percent on the yen, coming off a two-week high, and hit a three-week low on the euro. It also faltered on its New Zealand counterpart, drifting away from a more than seven-month peak touched on Thursday.
The New Zealand dollar slumped to a near two-month trough of $0.7043, dropping for a third straight day. The currency was poised for a weekly loss of 2 percent, the biggest since mid-December. New Zealand government bonds gained, sending yields 1 basis point lower at the long end of the curve. Australian government bond futures eased, with the three-year bond contract down three ticks at 97.940. The 10-year contract slipped 3.5 ticks to 97.150.