Investing.com - The Australian dollar fell to a three-day low against its U.S. counterpart on Wednesday, as market sentiment weakened amid sustained concerns over the handling of Spain’s financial woes and as downbeat Australian retail sales data weighed on the Aussie.
AUD/USD hit 0.9776 during late Asian trade, the pair’s lowest since May 25; the pair subsequently consolidated at 0.9789, declining 0.59%.
The pair was likely to find support at 0.9725, the low of May 25 and short term resistance at 0.9887, the high of May 28.
Markets were jittery as the yield on Spanish 10-year bonds climbed to their highest level so far this year on Tuesday, approaching the critical 7% threshold, after a Spanish official said the government is preparing to recapitalize Bankia, one of the country’s largest commercial lenders.
European Central Bank officials had earlier signaled they would oppose any attempt to fund Bankia’s EUR19 billion recapitalization via the central bank's lending facilities.
Meanwhile, Bank of Spain Governor Miguel Angel Fernandez Ordonez resigned a month early, handing to his successor the task of convincing investors that Spanish banks will not need an international bailout.
The Aussie also came under pressure after official data showed that retail sales in Australia fell unexpectedly in April, ticking down 0.2% after a 1.1% increase the previous month. Analysts had expected retail sales to rise 0.2% in April.
Elsewhere, the Aussie was lower against the New Zealand dollar with AUD/NZD shedding 0.26%, to hit 1.2877.
Also Wednesday, official data showed that building consents in New Zealand dropped 7.2% in April, after a 19.6% increase the previous month.
Later in the day, the U.S. was to release industry data on pending home sales.
AUD/USD hit 0.9776 during late Asian trade, the pair’s lowest since May 25; the pair subsequently consolidated at 0.9789, declining 0.59%.
The pair was likely to find support at 0.9725, the low of May 25 and short term resistance at 0.9887, the high of May 28.
Markets were jittery as the yield on Spanish 10-year bonds climbed to their highest level so far this year on Tuesday, approaching the critical 7% threshold, after a Spanish official said the government is preparing to recapitalize Bankia, one of the country’s largest commercial lenders.
European Central Bank officials had earlier signaled they would oppose any attempt to fund Bankia’s EUR19 billion recapitalization via the central bank's lending facilities.
Meanwhile, Bank of Spain Governor Miguel Angel Fernandez Ordonez resigned a month early, handing to his successor the task of convincing investors that Spanish banks will not need an international bailout.
The Aussie also came under pressure after official data showed that retail sales in Australia fell unexpectedly in April, ticking down 0.2% after a 1.1% increase the previous month. Analysts had expected retail sales to rise 0.2% in April.
Elsewhere, the Aussie was lower against the New Zealand dollar with AUD/NZD shedding 0.26%, to hit 1.2877.
Also Wednesday, official data showed that building consents in New Zealand dropped 7.2% in April, after a 19.6% increase the previous month.
Later in the day, the U.S. was to release industry data on pending home sales.