During early deals on Wednesday, the Australian and New Zealand dollars declined to new multi-day lows against the Japanese yen as the regional stock market weakness damped demand for higher-yielding currencies.

Australia's benchmark S&P/ASX 200 index fell 61.6 points to 3,644.7 by 0252 GMT, adding to a 1.3 percent fall, which had ended three days of gains that took the index to three-month highs.

New Zealand's benchmark NZX 50 index .NZ50 fell 37.7 points, or 1.4 percent, to 2,574.8.

The Aussie also slipped to a 5-day low against the Canadian dollar and edged down against the US currency. On the other hand, the aussie showed strength against the European currency.

In economic news from Australia, a private sector gauge of consumer economic sentiment in Australia posted a gain of 8.3 percent in April compared to the month before.

The Consumer Sentiment Index published by Westpac Bank and the Melbourne Institute today rose in April to a seasonally adjusted 92.7 points, following the March reading of 85.6. The April increase followed three straight months of declines.

Westpac Chief Economist Bill Evans said the result was surprising strong in the face of unemployment having risen to 5.2 percent, its highest level since September 2004.

Another report showed that the number of loans for new homes in Australia increased in February by a seasonally adjusted 0.4 percent over January, while the value of owner-occupied home construction permits increased 2.7 percent.

Yesterday, the Reserve Bank of Australia slashed the cash rate unexpectedly by a 25 basis points to a 49-year low to support the shrinking economy.

The RBA decided to lower the cash rate to 3%, effective April 8. Economists had expected the central bank to hold the key interest rate at 3.25%. The central bank has reduced the cash rate by 125 basis points since December 2008 and the official cash rate now stands at its lowest level in 49 years.

The RBA noted that the Australian economy is contracting, but less than those of its trading partners. Capacity utilization also started to fall from its peak and would continue to decline over the rest of the year.

The minutes of the April Monetary Policy Meeting of the Reserve Bank Board are due on April 21.

Against the US dollar, the Australian currency edged down during early deals on Wednesday. At 10:50 pm ET, the aussie-dollar pair touched a low of 0.7062, compared to 0.7111 hit late New York Tuesday. If the pair falls further, 0.701 is seen as the next target level.

The Australian dollar that closed Tuesday's North American session at 1.8675 against the European currency reached a high of 1.8622 at 8:35 pm ET. The euro-aussie pair is currently quoted at 1.8670 with 1.76 seen as the next target level.

Against the Japanese yen, the Australian dollar traded down during Wednesday's early deals. At 11:30 pm ET, the aussie-yen pair declined to a 5-day low of 70.60, compared to Tuesday's closing value of 71.42. The next downside target level for the pair is seen around 65.5.

The current account balance in Japan swung to a surplus in February, the Ministry of Finance said in a preliminary report today, coming in at 1.116 trillion yen.

That's down 55.6 percent on year, even though it beat expectations for a surplus of 1.071 trillion yen following the record 172.8 billion yen shortfall in January. The current account surplus was 125.4 billion yen in December, 581.2 billion yen in November and 960.5 billion yen in October.

The Australian currency that closed Tuesday's New York deals at 0.8799 against its Canadian counterpart slipped to a 5-day low of 0.8768 at 10:10 pm ET. On the downside, 0.866 is seen as the next target level for the aussie. The aussie-loonie pair is now worth 0.8788.

The New Zealand dollar also showed weakness against most of its major counterparts during today's early deals. The kiwi fell to a 6-day low against the US dollar and the Japanese yen, while edged higher against the European currency and the Australian dollar.

Against the US dollar and the Japanese yen, the kiwi traded down during Wednesday's early deals. The New Zealand dollar declined to a 6-day low of 0.5721 against the greenback and 57.21 versus the yen, compared to Tuesday's closing value of 0.5761 and 57.86 respectively. On the downside, the kiwi may likely target 0.559 against the dollar and 54.6 versus the yen.

The New Zealand dollar edged higher against the European currency during early deals on Wednesday. At 9:15 pm ET, the kiwi hit a high of 2.2981 versus the euro, compared to 2.3063 hit late New York Tuesday. The euro-kiwi pair is presently trading at 2.3064 with 2.25 seen as the next target level.

The New Zealand currency that closed Tuesday's New York deals at 1.2357 against its Australian counterpart climbed to 1.2326 at 10:10 pm Eastern time. If the New Zealand dollar strengthens further, 1.207 is seen as the next resistance level.

In the European session today, the German trade balance, current account and factory orders and the French trade balance are due for release.

Across the Atlantic, the Commerce Department is due to release its wholesale inventories report at 10 am ET. Economists expect wholesale inventories at the end of February to show a 0.6% decline.

The Energy Information Administration is scheduled to release its weekly petroleum inventory report at 10:30 am ET.

The Federal Reserve is scheduled to release the minutes of its March 17th-18th meeting at 2 pm ET.

Along with an announcement to keep interest rates unchanged at exceptionally low levels following its two-day FOMC meeting in March, the Fed said it would purchase $300 billion worth of longer-term securities over the next 6 months. Additionally, the Fed said it will buy an incremental $750 billion worth of mortgage-backed securities and $100 billion of government sponsored enterprises - GSE debt. The Fed also said it intends to add $100 billion to its purchases of agency debt.

In Canada, housing starts for the month of March will be released and are expected to continue their downward movement.

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