The Australian dollar slumped against its US counterpart on concerns about quantitative easing tampering from the Federal Reserve. The currency advanced versus the Japanese yen as China’s manufacturing expanded last month.
China manufacturing Purchasing Managersâ Index advanced from 51.1 in June to 51.3 in July, frustrating analysts who have predicted a drop to 49.8. China is the biggest trading partner of Australia. Institute for Supply Management reported that the US manufacturing PMI climbed from 50.9 percent in June to 55.4 percent in July. Such positive data fueled talks that the Fed may reduce its stimulus program earlier.
AUD/USD fell from 0.8978 to 0.8922 yesterday and traded at 0.8897 (near the lowest since August 2010) as of 1:51 GMT today. AUD/JPY was at about 88.56 after rallying from 87.87 to 88.82 on the previous trading session.
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