Australian Dollar Drops Amid Risk Aversion

The Australian dollar declined against its major counterparts on Thursday amid risk aversion, as the World Health Organization declared the coronavirus outbreak a global pandemic and as U.S. President Donald Trump's address on the coronavirus failed to ease investors' concerns about the economic impact of the outbreak.

Trump announced that all travel from Europe to the U.S. will be suspended for 30 days, in an attempt to curb the spread of the coronavirus. Investors are worried that the travel ban will further add to the existing business disruptions.

Meanwhile, the Australian government unveiled a A$17.6 billion economic plan to tackle the significant challenges posed by the spread of the coronavirus.

"Our targeted stimulus package will focus on keeping Australians in jobs and keeping businesses in business so we can bounce back strongly," Prime Minister Scott Morrison said.

The aussie declined to a 3-day low of 0.6442 against the greenback from Wednesday's closing value of 0.6484. The next possible support for the aussie is seen around the 0.62 level.

The aussie fell to 3-day lows of 1.7557 against the euro and 0.8874 against the loonie, from its early highs of 1.7335 and 0.8945, respectively. The aussie is poised to challenge support around 1.9 against the euro and 0.87 against the loonie.

The aussie slipped to more than a 7-month low of 1.0301 against the kiwi, from an early high of 1.0355. The aussie may locate support around the 1.02 level.

The aussie held steady against the yen, after having fallen to a 3-day low of 66.57 at 10:00 pm ET. The pair had finished yesterday's deals at 67.76.

Data from the Bank of Japan showed that Japan producer prices fell 0.4 percent on month in February.

That was shy of expectations for a decline of 0.3 percent following the 0.2 percent increase in January.

Looking ahead, Eurozone industrial production for January is due out in the European session.

The European Central Bank will announce interest rate decision at 7:45 am ET. The ECB is expected to hold its main refi rate at a record low zero percent and the deposit rate at -0.50 percent.

U.S. producer prices for February and weekly jobless claims for the week ended March 6 are scheduled for release in the New York session.