Forex News Asia – Australian dollar falls after RBA cuts rate; euro continues to fall

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AUDUSD opened in Asia t 1.0540 and tumbled to 1.0431 after the Reserve Bank of Australia cut its benchmark interest rate by 25 basis points to 4.5 percent. This is the first easing in two-and-a-half years, and investors are expecting more since the RBA appears more pessimistic on global growth but also a bit more relaxed about inflation.

 

EURUSD continued its freefall in Asia as the euro was sold off due to weaker risk appetite on debt concerns. Let in the US session the Greek Prime Minister said the new austerity plan may need a referendum, which ultimately could jeopardize the whole debt deal. Market sentiment worsened after disappointing China PMI data. EURUSD opened in Asia at 1.3863 and fell to a session low of 1.3790.

 

GBPUSD opened in Asia at 1.6082 and mirrored EURUSD movements, also falling on weak market sentiment to 1.6027. EURGBP consolidated after its 2 percent drop yesterday to 0.8596 from 0.8785.

 

USDCHF benefited from a stronger dollar and continued its advance recording a 2.2 percent rise since yesterday to peak at 0.8804 in Asia.

 

The yen was little changed after plunging yesterday versus the majority of its major counterparts after the Bank of Japan intervened in the currency market. Japan’s Finance Minister Jun Azumi told reporters in Tokyo today the government will continue to take appropriate action on the currency. USDJPY opened Asia at 78.08 and close about the same at 78.09.