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Talking Points:
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The Australian Dollar gained against its major peers following Chinese PMI data
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Manufacturing PMI was better than expected and non-manufacturing growth improved
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The private Caixin measurements will cross the wires early Thursday morning
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The Australian Dollar rallied against its major counterparts after a set of Chinese PMI figures crossed the wires. For those that are unfamiliar, a reading above 50 indicates expansion while a number below 50 shows contraction.
These figures were due to be released at 1:00 GMT Wednesday, however they escaped early. First, the non-manufacturing PMI reading came out at 00:47. The measurement clocked in at 54.5 in May versus 54.0 in April. Then, the non-manufacturing PMI was released 7 minutes later coming in unchanged at 51.2, better than the 51.0 print estimated.
With China being Australia’s biggest trading partner, economic news-flow from the former country often implies knock-on effects on the latter, triggering a response from the currency.
Market Analyst David Cottle mentioned that a disappointment in these readings could have left the Australian Dollar vulnerable if signs of deceleration meant Beijing would switch its focus to growth again. Looking ahead, there is still the private Caixin PMI readings which are scheduled to be released early Thursday morning.
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