(RTTNews) - The Canadian dollar slipped against the currencies of US, Europe, Australia and Japan on Friday as traders grew risk averse after reports on Chinese manufacturing PMI and German retail sales.
New Zealand\'s credit rating downgrade by Fitch and Standard & Poor\'s earlier in the day also hurt traders risk sentiment.
New Zealand\'s rating was lowered to AA from AA+, with Fitch terming New Zealand\'s outlook as \"stable.\" Fitch said a high level of external debt was among the reasons for the downgrade.
Standard & Poor\'s Ratings Services also downgraded its long-term foreign currency ratings on New Zealand to \'AA\' from \'AA+\' and its long-term local currency rating on New Zealand to \'AA+\' from \'AAA\'.
S&P also said that its outlook on the foreign and local currency ratings is stable.
China\'s manufacturing activity shrank only marginally in September despite the weakening global growth, the latest report from Markit Economics showed. However, inflation quickened to a four-month high during the month.
The Markit/HSBC purchasing managers\' index, or PMI, for the manufacturing sector was 49.9 in September, unchanged from August. Though the score was stronger than the flash estimate of 49.4, it averaged the lowest quarterly reading since the first quarter of 2009. A reading below 50 signals contraction in activity.
Meanwhile, data from the German Federal Statistical Office showed that the retail sales fell 2.9 percent month-on-month in August, following a 0.3 percent rise in July and 4 percent increase in June. Economists expected a 0.5 percent slump in sales from July.
However, retail sales increased 2.2 percent on year, against economists\' expectations for a 1 percent decline. This was the first increase in three months and follows a 1.8 percent drop in July.
The Canadian dollar is now trading at a fresh 1-year low of 1.0441 against the US dollar with 1.050 seen as the next downside target level. At yesterday\'s close, the greenback-loonie pair was quoted at 1.0360.
The Canadian dollar is presently trading at a 1-month low of 1.4123 against the euro, compared to yesterday\'s close of 1.4082. The next downside target level for the loonie is seen at 1.425.
The Canadian dollar that closed yesterday\'s trading at 74.20 against the Japanese yen is currently trading at a fresh 2- 1/2 -year low of 73.46. If the loonie-yen pair slides further, it may likely target the 70.9 level.
Against the Australian dollar, the Canadian dollar is now trading at a 9-day low of 1.0180. On the downside, 1.023 is seen as the next target level for the loonie. The aussie-loonie pair ended yesterday\'s trading at 1.0134.
