- Chinese 2Q GDP Grew 7.5% y/y vs. 7.4% Expected, 7.4% in 1Q
- Industrial Production +9.2% y/y, Retail Sales +12.4% y/y in June
- Australian Dollar Declined Despite Upbeat Chinese GDP Results
The Australian Dollar fell despite the release of better-than-expected Chinese GDP figures. The Chinese Yuan (CNH) remained relatively unchanged. Output grew 7.5 percent year-on-year in the second quarter, which was better than the expected 7.4 percent result. Industrial Production also saw a pick up, expanding at 9.2 percent year-on-year in June to top the expected 9.0 percent increase. Retail Sales rose 12.4 percent year-on-year, slightly less than the markets’ anticipated 12.5 percent figure.
The newswires suggested the currency markets’ seemingly counter-intuitive response to the GDP dataset reflected skepticism about the continuity of growth built on the foundation of sharp credit expansion. Indeed, new loan growth accelerated to 89 percent year-on-year in June. Stimulus considerations were likewise cited, with investors apparently concerned that stronger output readings would mean expansionary policy measures would not be expanded.
AUDUSD [15 mins – 07/16/2014] Created using FXCM MarketScope.