Australian, NZ Dollars Drop Amid Growth Fears

The Australian and NZ dollars fell against their major counterparts in the European session on Monday, as tightening of COVID-19 restrictions in China's two biggest cities, as well as the Federal Reserve's monetary policy tightening fueled concerns about a slowdown in global growth.

Beijing and Shanghai intensified restrictions as part of the effort to drive infections down to zero.

In Shanghai, some residents in at least four of its 16 districts were told to stay at their homes or prevented from receiving deliveries amid zero-Covid policy.

Authorities have ordered residents in worst-hit areas of Beijing to work from home and blocked off more roads, compounds and parks to contain the worst outbreak since 2020.

China's export growth slowed to the weakest in almost two years and imports were barely changed in April, adding to concerns over the economic outlook.

The aussie dropped to multi-month lows of 0.9048 against the loonie and 0.6993 against the greenback, from its early highs of 0.9125 and 0.7070, respectively. The aussie is seen locating support around 0.88 against the loonie and 0.68 against the greenback.

Reversing from its early highs of 92.32 against the yen and 1.4894 against the euro, the aussie slipped to a 1-week low of 91.61 and a 2-week low of 1.5023, respectively. The currency may seek support around 90.00 against the yen and 1.52 against the euro.

The kiwi dipped to near a 2-year low of 0.6337 against the greenback, 1-1/2-month low of 82.99 against the yen and more than a 2-month low of 1.6588 against the euro, off its early highs of 0.6413, 83.68 and 1.6426, respectively. If the kiwi slides further, it may find support around 0.62 against the greenback, 80.00 against the yen and 1.68 against the euro.

The kiwi eased to 1.1053 against the aussie, after rising to a 6-day high of 1.1001 in early deals. On the downside, 1.12 is likely seen as its next support level.