Australian, NZ Dollars Weaken Amid Rising Risk Aversion

The Australian and New Zealand dollars slipped against their major counterparts in the Asian session on Thursday amid rising risk aversion, as most Asian shares declined following the modest losses overnight on Wall Street and the plunge in crude oil prices amid lingering concerns about the U.S.-China trade war and its impact on global economic growth.

Traders cautiously awaited key events later this month including the Fed's policy review and the G20 meeting.

The G20 Summit, to be held in Osaka, Japan on June 28-29, brings together leaders from the world's developed and developing countries.

Investors wait to see if a failure by Chinese President Xi to come to the summit would lead to tariffs kicking in on a further $300 billion in Chinese imports.

In economic news, the Australian Bureau of Statistics said that the unemployment rate in Australia came in at a seasonally adjusted 5.2 percent in May, unchanged from the April reading, but missing forecasts for 5.1 percent.

The Australian economy added 42,300 jobs last month - blowing past expectations for an increase of 16,000 following the increase of 28,400 in the previous month.

The aussie declined to 6-1/2-month lows of 74.77 against the yen and 1.6363 against the euro, from its early highs of 75.29 and 1.6271, respectively. The aussie is seen finding support around 73.00 against the yen and 1.65 against the euro.

Reversing from its early highs of 0.6939 against the greenback, 0.9248 against the loonie and 1.0544 against the kiwi, the aussie declined to near a 2-week low of 0.6904, new 3-week low of 0.9202 and a 3-day low of 1.0506, respectively. The currency is likely to target support around 0.67 against the greenback, 0.90 against the loonie and 1.03 against the kiwi.

The kiwi slipped to a 9-day low of 71.11 against the yen, from a high of 71.43 hit at 8:30 pm ET. If the kiwi falls further, 73.00 is likely seen as its next possible support level.

Having climbed to a 2-day high of 1.7147 against the euro at 10:00 pm ET, the kiwi pulled back to 1.7199. On the downside, 1.65 is possibly seen as the next support level for the kiwi.

The kiwi hit a session's low of 0.6566 against the greenback, reversing from a high of 0.6588 hit at 10:00 pm ET. The kiwi is poised to face support around the 0.63 region.

Looking ahead, Eurozone industrial production for April and Swiss KOF economic forecast are due in the European session.

At 3:30 am ET, Swiss National Bank announces its decision on rates. Economists expect the interest rate on sight deposits to be retained at -0.75 percent and the target range for the three-month Libor to be kept unchanged between -1.25 percent and -0.25 percent.

In the New York session, U.S. import and export prices for May and weekly jobless claims for the week ended June 8 will be out.