Australian Dollar Steady, Supported by Fed Rate Cut Expectations
The Australian dollar (AUD) is stable after recording four days of gains. The AUD/USD pair has the potential to strengthen further as the US dollar (USD) weakens amid growing speculation of an interest rate cut by the Federal Reserve at its September meeting. Meanwhile, US markets are closed on Monday (September 1st) for Labor Day.
Domestically, the AUD/USD pair held steady after Australian Building Permits data fell 8.2% in July, worse than the expected 4.8% decline. However, higher-than-expected Australian inflation (July CPI rose 2.8% year-on-year) reduced the likelihood of an interest rate cut by the RBA, thus supporting the AUD.
In China, the official Manufacturing PMI rose slightly to 49.4, still below expectations, marking the fifth consecutive month of contraction. However, the Non-Manufacturing PMI strengthened to 50.3, and the Caixin PMI actually jumped to 50.5 in August from 49.5 the previous month. This development in the Chinese economy is important because it closely influences the movement of the AUD, given that China is Australia's main trading partner. (ayu)
Source: Newsmaker.id
