The Australian dollar fell against its US counterpart as the service industry performed poorly both in Australia and in China, adding to investors’ concerns. The currency rebounded later and closed with a small gain. The Aussie rose a little versus the euro and surged against the Japanese yen.
China’s Services Purchasing Managers’ Index declined from 52.1 in November to 51.7 in December. The index still indicated growth, but the expansion was slowest since August 2011. Australia’s Services PMI tumbled from 47.1 to 43 in December, demonstrating a decline of the sector.
Last day of this trading week was truly unpredictable and the Australian currency demonstrated that, falling against the US dollar after the poor data, but sharply rebounding later to close higher. Still, analysts are worried that the Reserve Bank of Australia may use the weak fundamentals as an excuse to cut interest rates yet again.
AUD/USD sank from 1.0463 to 1.0393, yet managed to close at 1.0481 yesterday. EUR/AUD closed at 1.2475 after rallying from 1.2465 to 1.2513. AUD/JPY soared from 91.26 to 92.36 — the highest closing price since August 2008.
If you have any questions, comments or opinions regarding the Australian Dollar,
feel free to post them using the commentary form below.