Australian Dollar Weakens On Global Growth Concerns

Australian Dollar Weakens On Global Growth Concerns

The Australian dollar declined against its major counterparts in the early Asian session on Monday as weak economic data from Japan, Australia and China raised pessimism about the outlook for global economic growth.

China's manufacturing activity shrank for the second straight month in September, data from China Federation of Logistics and Purchasing showed.

The manufacturing Purchasing Managers' Index rose to 49.8 in September from 49.2 in August.

China HSBC manufacturing purchasing managers' index was 47.9 in September, slightly up from 47.6 last month, another data released on the weakened showed. The PMI reading indicates contraction in the manufacturing sector for an eleventh straight month.

The contraction in Australia's manufacturing sector accelerated in September, the Australian Industry Group said today, after its index came in with a score of 44.1. That's down from 45.3 in August.

Also, the Bank of Japan's quarterly Tankan survey showed today that sentiment for its large manufacturers' index declined in the third quarter of 2012, coming in with a score of -3.

The headline figure beat expectations of a score of -4, although it dropped from -1 in the second quarter.

The aussie hit a 5-day low of 1.0336 against the U.S. dollar and a 4-day low of 80.55 against the yen with 1.03 and 80.00 seen as the next downside target levels, respectively. At Friday's close, the aussie was worth 1.0379 against the greenback and 81.00 against the yen.

Against the Canadian and NZ dollars, the aussie fell to a 5-day low of 1.0186 and a 1-year low of 1.2494, compared to Friday's closing value of 1.0205 and 1.2524, respectively. On the downside, the aussie may target 1.015 against the loonie and 1.24 against the kiwi.

The aussie pared early gains against the euro and the pair is now trading at 1.2400. The euro-aussie pair closed last week's trading at 1.2385.

Swiss retail sales for August, manufacturing PMI for September, U.K. mortgage approvals and Eurozone unemployment data - both for August, manufacturing PMI's from major European economies are due in the European session.

From the U.S., ISM manufacturing index for September and construction spending data for August are slated for release in the New York morning session.