Forex Marketz Daily Forex News – Fully Markets Update
Australian dollar investors, especially in the AUD/USD Forex market, passed over today’s Chinese core inflation number. There was little to get excited about.
Chinese consumer prices (CPI) rose, annually, 1.5 percent for the month of June. This was according to official Chinese figures. That was exactly the same as May’s number. It was just below the forecasted 1.6 percent rise. Food prices contracted a bit, while non-food prices made okay gains. The producer price index (PPI) rose 5.5 percent, as expected. Both inflation data pieces fell by 0.2 percent for that month, June.
This was no shock to investors and the news was widely expected by the financial markets within the Asian and Pacific Rim
The Australian Dollar ignores Chinese Inflation Data
The Australian Dollar usually acts as a liquid proxy to Chinese data. Australia’s number one importer of raw goods is Chine, after all. However in recent weeks the Australian dollar has been more vulnerable to disappointing data out of China. It seems to be less likely rise on stronger numbers. The Aussie did not do much after the inflation release. The AUD/USD barely moved and remains well within the range near 0.76.
The Reserve Bank of Australia (RBA) surprised last week, when they did not increase the volume of hawkish rhetoric. Investors had expected the RBA to follow other western central banks with a mounting hawkish tone towards monetary policy. The record-low, 1.5 percent official cash rate (OCR) will likely to stay put at until the closing months of 2018. It could start to rise at that point.
