We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Mixed
Wall Street
Bullish
Gold
Bearish
GBP/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • The trio of central banks overseeing the commodity currencies have already cut their main rates to all-time lows. Get your market update from @CVecchioFX here: https://t.co/OSUXrN5P3j https://t.co/3nwDel6e28
  • The tension from March continues to subside, allowing for the $USD to slide to fresh two-month-lows. Get your currencies market update from @JStanleyFX here: https://t.co/bRSRjUqg6Z https://t.co/Q35YpIZEd2
  • López Obrador hopes #USMCA will help tighten trade relationships between the US and Mexico. Get your currencies market update from @HathornSabin here: https://t.co/bZrUKSCGaS https://t.co/MZ7UoiWWRj
  • The $AUD may suffer as relations between Australia and China deteriorate amid dwindling growth prospects. Euro traders will be closely watching progress in talks about a €500b recovery fund proposal. Get your market update from @ZabelinDimitri here: https://t.co/LkEFJViPWY https://t.co/sofO135ElG
  • The US Dollar could rise against #ASEAN currencies such as the Singapore Dollar as US-China tensions seem to escalate. The Indian Rupee is also looking ahead of local 1Q GDP data. Get your ASEAN currencies market update from @ddubrovskyFX here:https://t.co/LkEFJViPWY https://t.co/ZGFaQQ3Hr2
  • The #Euro is the big driver here for DXY as it is 57% of the index. It is rising now and trying to break above the March 27 high at 11147. Get your $EURUSD technical analysis from @PaulRobinsonFX here:https://t.co/6gt3F9LuGP https://t.co/73SaL5AeXD
  • U.S. Market Analyst at https://t.co/JsVsSmefgR, Shain Vernier covers - ✔️ Safe haven assets in volatile markets ✔️ Central banks and governments ✔️ How will commodities trade in a recession Only on Trading Global Markets Decoded #podcast. Tune in here: https://t.co/1UmEzEbwiy https://t.co/EIC9YqfTec
  • Anybody else think that casting directors in movies are some of the most underrated people when it comes to giving a film/series credit?
  • No https://t.co/EoBltaP17k
  • Crude #oilprices may face heightened liquidation pressure as the cycle-sensitive #commodity finds itself under the pressure of resilient resistance and a vulnerable, multi-week rising channel. Get your crude #oil market update from @ZabelinDimitri here: https://t.co/cGPX4qcOH1 https://t.co/0U4JMJVFuf
AUD/USD Higher As Market Weighs Future PBOC And RBA Policies

AUD/USD Higher As Market Weighs Future PBOC And RBA Policies

2013-08-09 02:30:00
Jimmy Yang,
Share:

THE TAKEAWAY:China CPI and PPI miss expectations > RBA releases monetary statement and updates GDP growth and CPI forecasts, global outlook slightly weaker > AUD/USD Higher

The Australian Dollar traded higher against the US Dollar as the benchmark Chinese inflation figure missed expectations with a year-over-year CPI growth reading of 2.7 percent in July. In the same period, PPI declined 2.3 percent year-over-year, missing expectations for a more modest 2.1 percent. However, a state bureau assured that the number was in line with the recent recovery in manufacturing PMI.

The relatively low CPI figure could give the People’s Bank of China scope for easing. Last week, the central bank resumed repurchase agreements for the first time since February, injecting nearly 17 billion Yuan into the banking system. Indeed, the move likely helped avoid another credit-crisis by lowering overnight lending rates to the lowest levels since May. However, this is only a minor easing effort against China’s recent rhetoric supporting prudent monetary policy. Recent improvements in manufacturing and trade likely point a stronger economic outlook that could help maintain the PBOC’s stance.

AUDUSD_Higher_As_Market_Weighs_Future_PBOC_And_RBA_Policies__body_Chart_2.png, AUD/USD Higher As Market Weighs Future PBOC And RBA Policies

Investors trading the Aussie will be concerned with developments in Chinese economic policy because further easing by the central bank to encourage economic growth could drive demand for Australian commodity exports. An improved economic outlook for Australian business could reduce the RBA’s scope for easing, thereby moving AUD/USD higher. As such, investors will likely weigh their expectations for central bank policy on Chinese industrial production data scheduled for release later today at 5:30 GMT.

The Reserve Bank of Australia also released its monetary statement at the same time. After lowering its benchmark target interest rate on Tuesday, the central bank has now cut its outlook on GDP and CPI growth on higher-than-expected reductions in mining investments:

Year Ended

Dec-2013

Jun-2014

Dec-2014

Jun-2015

Dec-2015

GDP

2.25 (2.5)

2.5 (2-3)

2.5-3.5 (2.5-3.5)

2.75-3.75 (2.5-4)

2.75-4.25

CPI

2 (2)

2.5 (2-3)

2-3 (2-3)

2-3 (2-3)

1.75-2.75

* May forecastsare in parentheses

The reserve bank also sees slower growth in wages in the coming quarters and notes potential risks to household consumption that could lead to lower inflation. This may give the RBA more room to be accommodative towards economic growth. Another rate cut could further reduce the appeal of the Aussie for yield-seeking investors and move the pair lower.

AUD/USD (5-Minute Chart)

AUDUSD_Higher_As_Market_Weighs_Future_PBOC_And_RBA_Policies__body_Picture_1.png, AUD/USD Higher As Market Weighs Future PBOC And RBA Policies

Source: FXCM Marketscope

New to Forex? Watch this video.

Jimmy Yang, DailyFX Research Team

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.