Forex News: Commodity Currencies Rise Amid Risk-on Mood

Commodity Currencies Rise Amid Risk-on Mood

(RTTNews) - The commodity currencies such as Australia, the New Zealand and the Canadian dollars strengthened against other major currencies in the Asian session on Monday amid increased risk-on mood, as traders remain optimistic the US Fed will cut interest rate by another 50 bps by year-end on easing trade tensions between the U.S. and China and cooler-than-expected US consumer price inflation data. They now look ahead to the Fed's monetary policy announcement later in the week.

U.S. Treasury Secretary Scott Bessent said U.S. President Donald Trump's threat to impose 100 percent tariffs on Chinese goods is "off the table."

"Consumer inflation came in cooler in September, reinforcing expectations that the Fed will cut rates again at next week's policy meeting," said Nationwide Chief Economist Kathy Bostjancic.

She added, "We remain of the view that the Fed will cut the fed fund rate by another 50bps by year-end as the weakening in the labor market outweighs concerns about moderately higher inflation stemming mostly from the tariffs."

In the Asian trading today, the Australian dollar rose to near 3-week highs of 0.6542 against the U.S. dollar and 100.10 against the yen, from Friday's closing quotes of 0.6514 and 99.57, respectively. If the aussie extends its uptrend, it is likely to find resistance around 0.66 against the greenback and 101.00 against the yen.

Against the euro, the aussie climbed to nearly a 2-week high of 1.7788 from last week's closing value of 1.7849. The aussie may test resistance near the 1.75 region.

Against the Canada and the New Zealand dollars, the aussie edged up to 0.9146 and 1.1349 from last week's closing quotes of 0.9117 amd 1.1331, respectively. On the upside, 0.92 against the loonie and 1.14 against the kiwi are seen as the next resistance levels for the aussie.

The NZ dollar rose to near 3-week highs of 0.5770 against the U.S. dollar and 88.25 against the yen, from last week's closing quotes of 0.5749 and 87.88, respectively. If the kiwi extends its uptrend, it is likely to find resistance around 0.59 against the greenback and 89.00 against the yen.

Against the euro, the kiwi edged up to 2.0175 from Friday's closing value of 2.0225. The kiwi is likely to find resistance near the 2.00 region.

The Canadian dollar rose to nearly a 3-week high of 109.48 against the yen, from Friday's closing value of 109.23. On the upside, 110.00 is seen as the next resistance level for the loonie.

Against the U.S. dollar and the euro, the loonie edged up to 1.3979 and 1.6264 from last week's closing quotes of 1.3996 and 1.6271, respectively. If the loonie extends its uptrend, it is likely to find resistance around 1.38 against the greenback and 1.58 against the euro.

Looking ahead, the German Ifo business climate index for October is due to be release at 4:00 am ET in the European session.

In the New York session, U.S. Dallas Fed manufacturing index for October and U.S. durable goods orders for September are slated for release.

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