Australian Dollar, New Zealand Dollar Jump on Rising Chinese PMI
Data released by the China Federation of Logistics & Purchasing shows an unexpected increase in the country’s Purchasing Manager Index (PMI) in the month of February. The PMI index rose to 51.0 from 50.5, topping analysts’ expectations of a bump up to 50.8. The increase indicates that the Chinese manufacturing sector is growing at a faster rate than it was in January.
The unanticipated Chinese PMI boost added onto buying pressure for both the AUDUSD and NZDUSD. Both currency pairs had been trending upward before the release, and the better-than-expected data fed the positive trends. The rising index suggests that the Chinese market will be more receptive to importing raw materials and intermediate goods from Australia and New Zealand. In addition, there is also the encouragement to risk taking through speculative interests and carry trade.
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