The Australian and New Zealand dollars clung to rare weekly gains on the US dollar on Friday as Treasury yields plunged to historic lows, but all three currencies were losing to the euro and yen as the outlook for interest rates shifted radically.

The Aussie was hanging on at $0.6596, having climbed almost 1.3% for the week and away from an 11-year low of $0.6454. However, a failure to clear chart resistance around $0.6646 left it vulnerable to a setback at any time.

It was not helped by disappointing data showing Australian retail sales fell 0.3% in January as weeks of bushfires and smoke kept shoppers indoors. The kiwi dollar had added 0.9% for the week to $0.6306 , again leaving behind an 11-year trough of $0.6180. It now faces resistance at $0.6334 and $0.6359. The bounce, though, was not a sign of domestic strength but rather US dollar weakness as markets rushed to price in even more outsized rate cuts from the Federal Reserve following its emergency half-point easing this week. Futures imply a 95% probability of a further 50 basis-point-cut at the Fed's regular meeting on March 18, a real chance rates would be near zero by Christmas.

Such an easing would dwarf anything the Reserve Bank of Australia (RBA) might manage. Having cut by a quarter point to 0.75% early this week, policymakers have emphasised there is room for only one more move to 0.25%. The Aussie has sunk below its 2019 low of 69.93 yen to reach 68.89, depths last reached in April 2009.

The euro has also stormed to its highest since 2009 at A$1.7123, after breaking a tight trading band that had lasted for much of the past year. "The global mood swing against the US dollar is likely to extend near term, pressuring what were record real money A$ shorts in the futures market," said Westpac senior FX analyst Sean Callow. "But the broader picture remains bearish for AUD crosses, and sub-$0.6400 is still a reasonable multi week target."