The market sentiment improved today after fears about the crisis in Turkey eased, alleviating pressure on riskier currencies. Yet the Australian dollar was mixed as domestic macroeconomic data was also mixed, while economic releases in China, Australia’s biggest trading partner, were universally disappointing.
The business confidence index reported by National Australia Bank ticked up from 6 to 7 in July. At the same time, the business conditions index fell from 14 to 12.
The National Bureau of Statistics of China released a range of important macroeconomic indicators today, and basically all of them failed to meet market expectations. Investment in fixed assets rose by 5.5% in January through July compared to the same period a year ago, while economists had expected the same 6.0% rate of growth as in the previous reporting period. Industrial production rose 6.0% in July, year-on-year, same as in June and trailing forecasts of a 6.3% rate of increase. Retail sales increased 8.8%, slowing from the previous month’s 9.0% and failing to meet analysts’ projections of 9.2% growth. The unemployment rate edged up from 4.8% in June to 5.1% in July.
AUD/USD traded at 0.7259 as of 10:59 GMT today after opening 0.7268 and touching the daily high of 0.7283. EUR/AUD rallied from 1.5679 to 1.5712. AUD/JPY rose from the open of 80.40 to 80.53, though retreated from the session maximum of 80.81.
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