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Forex pairs in this Article » USD, AUD/USD, EUR/AUD, AUD/JPY
Talking Point:

  • China HSBC Manufacturing PMI Came in at 50.8 vs. 50.5 Expected, 50.9 Oct.
  • Stable PMI Give China Time to Implement Policy Changes from Third Plenum
  • Aussie Dollar Surgedas Firm Chinese Data Weighed on RBA Rate Cut Bets
AUD/USDrose after HSBC reported its Manufacturing PMI gauge came in at 50.8 in November, above 50.5 expected and 50.9 recorded in October. The Aussie surged from 0.9140 to 0.9160, the highest in a week. Similar price action was observed elsewhere asAUD/JPYrose from 93.50 to 93.70 and on the same note EUR/AUD slumped from 1.4878 to 1.4848. The report echoed official PMI figures released over the weekend that saw an increase to 51.4 in November versus 51.1 expected and 51.4 in the prior month.

Stability in manufacturing in the world’s second-largest economy may giveChinese Premier Li Keqiang more room to implement policy changes laid out with the Third Plenum meeting last month. This may also indicate thatChina’s economic recovery is sustaining momentum amid government efforts to rein in credit growth.

Chinese officials said in October that in order to keep China’s unemployment rate stable the nation needs an annual growth rate of 7.2%. China is Australia’s top export market, so stable economic growth there may help to boost Australian performance and prevent the RBA from restarting interest rate cuts.

From here, the market will shift its focustothe US ISM Manufacturing gauge, as well as Australia’s RBA interest rate decision.

China Manufacturing PMI Data at a Glance

- HSBC Markit Manufacturing PMI: 50.8 in November vs. 50.5 Expected, from 50.9 in October.

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AUD/USD 5-minute Chart: December 2, 2013

Australian_Dollar_Surges_After_Chinese_PMI_Data_Tops_Expectations_body_pmi1.png, Australian Dollar Surges After Chinese PMI Data Tops ExpectationsNew to Forex?Watch this video

-- Written by Cheng Li, DailyFX Research. Feedback can be sent to cli@fxcm.com

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