Australian Dollar Slumps After Chinese Manufacturing PMI Disappoints
- HSBC’s Chinese Manufacturing PMI fell to 49.6 in January vs. 50.3 Expected
- A Slowing China Threatens Australian Growth, RBA Interest Rate Prospects
- The Australian Dollar Fell Against the Euro, British Pound and the US Dollar
The Australian Dollar sunk after HSBC reported its Chinese Manufacturing PMI gauge came in at 49.6 in January, below estimates calling for a print at 50.3 and down from 50.5 recorded in December. The Aussie dropped from 0.8836 to 0.8793, reversing its move upward. China’s is Australia’s top trading partner, with a slowdown there threatening to hurt export demand and undermine RBA monetary policy expectations.
Last week, China’s fourth-quarter GDP data showed output growth slowed to 7.7 percent year-on-year from 7.8 percent in the previous period, marking the weakest performance since 1999. Traders worry that more of the same may be ahead as Chinese Premier Li Keqianq and company try to shift the country from an export-driven growth model to one powered by domestic consumption.
AUD/USD 5 minute Chart - Created by Daniel Giardina using Marketscope 2.0
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