Australian Dollar Flat Despite Upbeat Aussie GDP, Chinese PMI Data
- Australia’s 2Q GDP +3.1% Y/Y vs. +3.0% Expected,+3.4% in the Prior Quarter
- HBSC Chinese Composite PMI Rose to 52.8 in August from 51.6 Recorded in July
- Aussie Dollar Little-Changed as GDP, PMI Data Fails to Nudge RBA Policy Bets
The Australian Dollar was little-changed against its US namesake after the Australian Bureau of Statistics released the nation’s GDP report for the second quarter of 2014. The economy expanded 3.1 percent from a year earlier, beating market expectations of 3.0 percent but coming in lower than last quarter’s 3.4 percent. GDP grew at 0.5 percent from the previous quarter, also beating expectations of 0.4 percent. This figure printed lower than the first quarter’s 1.1 percent.
The Australian Dollar initially spiked upward but pared its gains almost immediately despite better-than-expected figures likely because the difference between actual and expected reports was not significant enough to drive more hawkish policy expectations from the Reserve Bank of Australia. Earlier this week, the central bank maintained its status-quo policy stance calling for a “period of stability in interest rates” for the near future.
Strong Chinese PMI was also unable to move the Aussie. China is Australia’s largest trade partner and signs of firming activity there might have been expected to improve investors’ outlook on Australian export growth, fueling upbeat growth bets and tighter RBA policy expectations. This dynamic may have been absent this time around because of the close proximity of another neutral RBA rate decision.
AUDUSD [30 mins – 09/03/2014]. Chart created using FXCM Marketscope
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