Australian Dollar Strengthens Slightly, RBA in Investor Focus Ahead of New Year
The Australian Dollar (AUD) strengthened slightly against the US Dollar (USD) in early trading, maintaining gains for the second consecutive session. The AUD/USD pair's movement was relatively limited as trading volume was expected to be thin ahead of the New Year holiday in Australia. Investors appeared cautious, awaiting a clearer market direction after key economic data was released.
The AUD's movement was supported by the release of China's official Purchasing Managers' Index (PMI), which showed an increase. The Manufacturing PMI rose to 50.1 in December from 49.2 previously, while the NBS Non-Manufacturing PMI increased to 50.2 compared to 49.5 the previous month. These figures exceeded market expectations and provided positive sentiment for the Australian currency, which is sensitive to the Chinese economy.
Investors' focus was also on the Reserve Bank of Australia (RBA), which previously expressed its readiness to adjust interest rates if inflation persists. The minutes of the RBA's December meeting indicated that policymakers could tighten monetary policy as early as 2026, depending on fourth-quarter inflation data due on January 28. Analysts believe a higher-than-expected core inflation figure could trigger a rate hike at the RBA's February 3 meeting. (az)
Source: Newsmaker.id
