The Australian dollar extended its previous sessions' losing streak versus its major opponents on Friday morning in New York as traders flee from riskier-currencies following the report showed that the US economy lost more jobs in September than economists had predicted.

The domestic currency also tumbled after the Australian stock market suffered its biggest percentage fall in more than 3 months today. The benchmark S&P/ASX 200 index closed at 4,601, down 99 points or 2.11% and the broader All Ordinaries index fell 96 points or 2.04% to 4,606.

On the economic front, TD Securities said today that an index measuring inflation in Australia was up 1.3% on year in September, marking the slowest rate of increase in seven years. This marked the fifth straight month that inflation has come in below the Reserve Bank of Australia's target range of 2%-3%.

The Australian dollar slumped to a 17-day low of 0.8572 against the US dollar by 8:30 am ET, down around 3.3 percent from yesterday's fresh 13-month high of 0.8861. The next downside target for the aussie-buck pair is likely to be seen near the 0.855 level. At Thursday's close, the pair was worth 0.87.

In the U.S., job losses in September were sharply higher than economists had expected, driving the unemployment rate to its highest level in 26 years and pushing the number of people out of work above 15 million, the U.S. Labor Department revealed today.

Non-farm payrolls dropped 263,000 in September. Economists had expected a decline of 170,000 jobs. August's results were revised to show a decline of 201,000 jobs.

The unemployment rate for September came in at 9.8% compared to 9.7% in the previous month.

The Australian dollar dropped more than 4 percent to 76.35 against the Japanese yen from yesterday's weekly high of 79.58 to reach its lowest level since July 22nd. The next downside target for the aussie-yen pair is seen around the 75.7 level.

Japan's jobless rate edged down in August, after hitting a record high in July, an official report showed today, raising hopes that sustained recovery in the world's second largest economy may be well on track. Moreover, consumer spending also increased in August, after falling in July.

Data released by the Ministry of Internal Affairs and Communications showed Friday that the jobless rate decreased to 5.5% in August, on a seasonally adjusted basis, from a record high of 5.7% in July. Moreover, the rate came in below economists' expectations for 5.8%.

Elsewhere, the Bank of Japan said today the monetary base rose 4.5% year-on-year in September to 92.39 trillion yen, following a 6.1% rise in August. Seasonally adjusted, the monetary base was down 11.9% in September.

Extending its 2-day losing streak, the Australian currency declined to a 4-day low of 1.2065 against the New Zealand dollar around 8:30 am ET. This may be compared to yesterday's close of 1.218. If the aussie drops further, likely support is seen around the 1.204 level.

The Australian dollar that surged to a 14-month high of 1.6519 against the European currency on Thursday pared more than 2.4 percent to reach a 4-day low of 1.6931 by 8:30 am ET Friday. The euro-aussie pair, which closed yesterday's deals at 1.6729, is presently worth 1.6886 with 1.70 seen as the next target level.

The Eurostat said today in a report that Eurozone industrial producer price index or PPI dropped 7.5% year-on-year in August, compared with a 8.4% fall in the previous month. The July month figure was revised from 8.5% decline reported initially. Economists expected a decline of 7.6%.

Month-on-month, producer prices increased 0.4% in August, after falling 0.7% in July , revised from 0.8% drop estimated initially. Economists were looking for a decline of 0.4%.

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