-- Australian dollar leads decline in commodity-linked currencies -- Sterling under pressure following disappointing GDP data -- U.S durable goods data in focus later in the day By Clare Connaghan Of DOW JONES NEWSWIRES LONDON (Dow Jones)--Worries over a slowdown in China continued to weigh on the commodity-linked currencies of Australia, New Zealand and Canada in European trading Wednesday while a downward revision of U.K. economic growth gave sterling a brief scare. The Australian dollar fell to its lowest level this year against the euro and slid against the dollar after a sell-off in Chinese shares re-ignited concerns about the health of the world's second largest economy. China is a massive importer of Australian natural resources. "Nerves [that] China is heading for a slowdown is leading the market to cut a lot of their long positions in the Australian dollar," Michael Sneyd, a foreign-exchange strategist at BNP Paribas in London. The New Zealand and Canadian dollar also fell against the greenback as investors retreated from currencies seen as more exposed to cyclical changes in global economic growth and therefore as relatively more risky. "What we're seeing is risk being taken off the table particularly as we head into the end-of-the quarter, which is boosting the dollar against the commodity-linked currencies," Sneyd added. Sterling was another focal point of the session after a revision of U.K. gross domestic product data showed the economy shrank more than previously thought in the fourth quarter of 2011. The pound fell to its lowest point of the day against the dollar and euro immediately after the Office for National Statistics said gross domestic product contracted 0.3% between October and December after growing 0.6% in the third quarter. But it then recovered some ground. By 1054 GMT, the pound was at $1.5926 against the dollar, compared with $1.5950 late Tuesday in New York. The euro was marginally higher against the dollar after Federal Reserve Chairman Ben Bernanke followed Monday's commitment to accommodative monetary policy with more cautious remarks about the U.S. economy. In a televised interview Tuesday Bernanke said the U.S. economy isn't on a certain path to a full recovery while acknowledging a brightening in the recent economic data. Looking ahead, U.S. durable goods data is released at 1230 GMT. After that, a two-day meeting of euro-zone finance ministers in Copenhagen will move into the spotlight, with worries growing over Spain. Earlier Thursday, Citigroup Chief Economist Willem Buiter said Spain looks likely to need some sort of bailout program by the end of the year, though a debt restructuring for the euro zone's fourth largest economy is avoidable. In a further negative sign, Italian two-year bond yields rose to their highest level in a month as traders made way for more supply lined up in the week and looked to book profits with the first quarter drawing to a close. At 1054 GMT, the euro was trading at $1.33508 against the dollar, compared with $$1.3313 late Tuesday in New York, according to trading system EBS. The dollar was at Y83.000 against the yen, compared with Y83.18, while the euro was at Y110.83 compared with Y110.74. The pound was at $1.5921 against the dollar, compared with $1.5950 late Tuesday in New York. A summary of key levels for chart-watching technical strategists: Forex spot: EUR/USD USD/JPY GBP/USD USD/CHF Spot 1032 GMT 1.3342 83.03 1.5930 0.9038 3 Day Trend Bullish Range Bullish Bearish Weekly Trend Range Bullish Bullish Bearish 200 day ma 1.3453 79.23 1.5814 0.9072 3rd Resistance 1.3415 83.39 1.6044 0.9118 2nd Resistance 1.3385 83.22 1.6001 0.9083 1st Resistance 1.3374 83.11 1.5962 0.9055 Pivot* 1.3337 83.07 1.5967 0.9041 1st Support 1.3311 82.61 1.5904 0.9016 2nd Support 1.3286 82.56 1.5884 0.8931 3rd Support 1.3232 82.33 1.5848 0.8921 Forex spot: EUR/GBP Spot 1032 GMT 0.8377 3 Day Trend Bullish Weekly Trend Range 200 day ma 0.8505 3rd Resistance 0.8447 2nd Resistance 0.8423 1st Resistance 0.8395 Pivot* 0.8351 1st Support 0.8334 2nd Support 0.8300 3rd Support 0.8284 -By Clare Connaghan, Dow Jones Newswires, +44 (0) 20 7842 9496; clare.connaghan@dowjones.com;@djfxtrader (Dow Jones Technical Strategist Francis Bray and William Kemble-Diaz in London contributed to this article.)

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