The Australian Dollar has slipped slightly after the Chinese CPI and PPI data missed expectations. The country’s consumer price index rose 1.5% y/y in October, which was higher than the median forecast of 1.4%. The data also showed that input costs for producers were lower than expected. This could mean that China has reached peak production and the economy is starting to slow.
Inflation data in China will come out today. The Chinese language CPI is expected to drop to 1.5% from 2.3% before. The PPI will print at 10.3% instead of the 11.1% anticipated. While the report is soft, it may suggest that the market has reached a low point for enter prices. The Australian dollar’s strength is also linked to the weakening of the US dollar.
The Australian Dollar continues to face downward pressure on Wednesday, aiming to post a second daily loss. The 50-day Simple Moving Average (SMA) is holding the pair through Wednesday’s session. However, if it can fall further, the pair could see further losses. Additionally, the MACD and RSI indicators are pointing lower. The short-term path is likely to remain biasing to the downside.
Despite the recent negative news, the outlook for the AUD is still bullish. The Chinese language CPI came in lower than expected on December. The PPI, on the other hand, was much weaker than expected and may have peaked. The US government’s announcement about monetary policy will likely provide some support to the Australian Greenback.
The Australian Dollar has been weighing on a number of economic indicators today. The US will release December’s CPI, which will likely show that a slowdown in China’s property market is affecting the AUD. Meanwhile, Japan will report the January Tankan Manufacturing Index and the Japanese will have markets closed on Coming-of-Age Day.
The Australian Dollar is under pressure due to a number of factors. The first is a softer Chinese economy. Its imports from Australia were cleared last month, but China’s economic growth remains weak. In addition to the softer CPI, the AUD/USD will be impacted by the weaker New Zealand dollar. A rise in the AUD/USD will also affect the Australian currency’s strength. Its volatility may have a positive impact on the Aussie.
The Australian Dollar has been rising in the last few days due to a softer global economy. The US dollar is weaker as well, and a higher Australian dollar will stabilize global markets. This is a very good sign for the AU, which was weakened against its most important rival. If the AUD is underperforming against the US, it will likely fall in the near future.