The Australian dollar opened sharply higher on Monday thanks to the news about a ceasefire in the trade war between the United States and China. The news overshadowed Australia’s domestic macroeconomic reports, basically all of which were poor.
The Australian Industry Group Australian Performance of Manufacturing Index slumped from 58.3 in October to 51.3 in November, signaling that manufacturing growth slowed significantly. In fact, it was the lowest reading since October 2017. Building permits dropped 1.5% in October from September on seasonally adjusted basis after rising 5.5% in the previous month. Company gross operating profits rose 1.9% in the September quarter from the previous three months on a seasonally adjusted basis, down from the 2.4% rate of growth in the previous quarter and missing the consensus forecast of a 2.9% increase.
Yet all the negative data was unable to bring down the Aussie. While all commodity currencies profited from the news about the truce between the USA and China, the Australian dollar was the biggest winner. Market analysts explained that by the fact that both the United States and China are major trading partners of Australia.
AUD/USD traded at 0.7371 as of 15:06 GMT today after closing at 0.7308 on Friday. EUR/AUD was at about 1.5396, down from the Friday’s close of 1.5488. AUD/JPY traded near 83.96 following the Friday’s close of 82.92.
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Aussie Emerges as Strongest on Forex Market, Ignores Domestic Data
