The Australian dollar sank today, reaching the weakest rate since May 2009 against its US counterpart. The drop followed disappointing Australian retail sales and bad news from China — Australia’s biggest trading partner.
Australian retail sales grew 0.3 percent in May from April but failed to meet the market expectations of 0.5 percent growth. Meanwhile, the HSBC China Services Business Activity Index dipped to 51.8 in June from 53.5 in May, the strongest reading in eight months, even though analysts promised an increase to 53.8. Coupled with the big drop of Chinese stocks, the economic health of the Asian nation causes concern, and this is not good news for the Australian economy that is strongly relies on shipping goods and raw materials to China.
AUD/USD tumbled 1.5 percent from 0.7631 to 0.7516 as of 13:49 GMT today. AUD/JPY declined as much as 1.8 percent from 93.90 to 92.21, trading near the lowest level since April 21.
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