The Australian dollar resumed its rally, following yesterday’s drop, as accelerating inflation in China improved prospects for exports from the South Pacific nation and lifted the traders’ sentiment.
The Chinese Consumer Price Index rose by 2.5 percent year-on-year in January. The increase was a bit higher than analysts’ expectations. The gauge went up by 1.0 percent on a monthly basis. Meanwhile, the Producer Price Index decreased 1.6 percent year-on-year and 0.1 percent month-on-month.
The positive consumer inflation data helped the Aussie, which halted its rally due to the very bad Australian employment data. China is the biggest trading partner of Australia and therefore any good news from the Asian nation significantly improves trade prospects and, consequently, the performance of the Australian currency.
AUD/USD rose from 0.8978 to 0.9031, and AUD/JPY advanced from 91.73 to 91.99 as of 19:18 GMT today. EUR/AUD went down from 1.5232 to 1.5162.
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