FXTM Online Analysis Department.

The Australian dollar is unnerved by Chinese statistics

The AUD/USD pair stopped after two days of rapid growth, while it’s analysing a block of Chinese statistics.

The Australian dollar rose for the last two sessions on the background of a decline in speculative interest in the American counterparts. However, this morning the purchase of the AUD/USD pair has stalled. The reason for that is the block of statistical data on China, which is seeing new signs of slowing economic growth of China.

According to statistics, preliminary index of purchasing managers in the manufacturing sector in China in March dropped to 49.2 points against the level of 50.7 points in February. The important part here is that the rate went down under the psychologically important level of 50 points: everything below it indicates a contraction in activity.

Today's report, though preliminary, looks quite disturbing. The figure itself is at a minimum of eleven months, and there is reason to believe that the trend will continue.

The AUD naturally reacts negatively to weak Chinese statistics, as China is a key trade and economic partner for Australia. For now the AUD/USD will remain around the level of 0.7860.


FXTM Online Analysis Department.