Chinese PMI Sinks Aussie and Kiwi Dollars
In Asian trading on Friday, both the New Zealand and Australian Dollars lost ground against the US Dollar after the release of PMI figures from China for January. The Caixin Manufacturing PMI reading came in at 48.3, below the 49.5 reading which had been predicted in the latest poll; the previous reading was at 49.7. Any number below the 50.0 mark points to a contraction in the sector or industry. Yesterday, the NBS Manufacturing PMI survey was released, with a number similarly below the 50.0 threshold; the reading at 49.5 for January was at least a slight improvement over the 49.3 predicted.
As reported at 10:36 am (JST) in Tokyo, the NZD/USD was trading at at $0.6906, down 0.15%; the pair has ranged from a session trough of $0.68990 to a peak of $0.69223. The AUD/USD was trading at $0.7243, down 0.40% and moving off the earlier high of $0.72784 while the low was recorded at $0.72390 in the session.
Antipodean Currencies Outlook Improves
Analysts say that in the longer term, they expect to see both the Kiwi and Aussie Dollars hold their ground against the US Dollar, given the more dovish position taken by the US Federal Reserve Bank which helped to improve risk appetite. Earlier in the week, the US central bank had maintained rates at current levels, but expressed a more dovish outlook as regards its promise to gradually raise interest rates, saying it would exercise patience before adjusting policy. Also helping to support higher risk currencies is the improved prospects for a trade deal between the US and China.