Australian dollar is heading lower today, thanks mainly to disappointing Chinese data. With Chinese data down, and concerns about the Australian economy, there is speculation that the RBA will have to consider cutting rates again.
Aussie is down across the board today, following the latest economic data out of China. The world’s second-largest economy is one of Australia’s major trading partners, and the data indicates that China is importing less. This doesn’t bode well for the Australian economy since there is great reliance on Chinese demand.
On top of that, reports have the prices for iron ore in decline. Australia relies heavily on its raw materials — including iron ore. With prices for iron dropping, and with demand falling in China, there are worries that the Australian economy could suffer.
Some are already predicting another interest rate cut from the Reserve Bank of Australia. If the RBA thinks that there is a risk to the Australian economy, it won’t hesitate to cut interest rates, which could weaken the Aussie further against its major counterparts.
At 11:30 GMT AUD/USD is lower, falling to 0.7561 from the open at 0.7668. AUD/NZD is down to 1.0183 from the open at 1.0197. AUD/JPY is also lower, falling to 91.2560 from the open at 92.3050.
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