Investing.com - The Australian dollar tumbled to a three-day low against its U.S. counterpart on Tuesday, after Standard & Poor’s put 15 euro zone countries on watch for downgrades and as the Reserve Bank of Australia cut its benchmark interest rate.
AUD/USD hit 1.0165 during late Asian trade, the pair’s lowest since November 30; the pair subsequently consolidated at 1.0173, declining 0.96%.
The pair was likely to find support at 1.0059, the low of November 16 and resistance at 1.0330, the high of November 30.
S&P said it may carry out a mass credit downgrade of euro zone countries if their leaders fail to move decisively on solving the region's debt woes at Friday’s key economic summit.
The warning came after German Chancellor Angela Merkel and French President Nicolas Sarkozy presented a common platform that aims to halt the region’s debt crisis. The plan calls for automatic penalties for deficit violators and locking limits on debt into euro zone states’ constitutions.
Earlier Tuesday, the RBA cut its interest rate for the second successive month from 4.50% to 4.25%.
Commenting on the decision, RBA Governor Glenn Stevens said that fiscal conditions have been more difficult, particularly in the euro zone and this was likely to weigh on global growth.
Elsewhere, the Australian dollar was lower against the euro with EUR/AUD climbing 0.56%, to hit 1.3121.
Also Tuesday, official data showed that Australia’s current account deficit narrowed less-than-expected in the third quarter, hitting AUD5.6 billion from a deficit of AUD6.7 billion the previous quarter.
Analysts had expected the current account deficit to narrow to AUD5.5 billion in the third quarter.
AUD/USD hit 1.0165 during late Asian trade, the pair’s lowest since November 30; the pair subsequently consolidated at 1.0173, declining 0.96%.
The pair was likely to find support at 1.0059, the low of November 16 and resistance at 1.0330, the high of November 30.
S&P said it may carry out a mass credit downgrade of euro zone countries if their leaders fail to move decisively on solving the region's debt woes at Friday’s key economic summit.
The warning came after German Chancellor Angela Merkel and French President Nicolas Sarkozy presented a common platform that aims to halt the region’s debt crisis. The plan calls for automatic penalties for deficit violators and locking limits on debt into euro zone states’ constitutions.
Earlier Tuesday, the RBA cut its interest rate for the second successive month from 4.50% to 4.25%.
Commenting on the decision, RBA Governor Glenn Stevens said that fiscal conditions have been more difficult, particularly in the euro zone and this was likely to weigh on global growth.
Elsewhere, the Australian dollar was lower against the euro with EUR/AUD climbing 0.56%, to hit 1.3121.
Also Tuesday, official data showed that Australia’s current account deficit narrowed less-than-expected in the third quarter, hitting AUD5.6 billion from a deficit of AUD6.7 billion the previous quarter.
Analysts had expected the current account deficit to narrow to AUD5.5 billion in the third quarter.