Aussie Dollar Steady Regardless of January Chinese Inflation
The #Aussie dollar displayed some inadequate reaction, sliding continually so faintly versus the greenback after the release of the Chinese consumer and wholesale inflation data for the month of January.
The #Chinese Consumer Price Index was seen slightly higher at 1.8% yoy against an estimated +1.9% yoy. This makes it four months in a row that prices have surged higher from the previous period, as well as it being at the highest level since August 2015.
Looking at the wholesale side of things, #Producers Price Index (#PPI) shed 5.4% yoy versus a likely contraction of 5.4% yoy. This puts a halt to a 4 month consecutive streak where we saw a drop in wholesale expenses at the same rate of 5.9% yoy. This also marks the most sluggish rate of deflation since July 2015.
Coming worse than expected is the #CPI figure, which pushed the People’s Bank of China to proceed on some action by delivering more stimulus. This might not be why we saw the Australian dollar push lower slightly, as negative news from China can affect the way the #RBA will attack interest rates. Australia’s biggest trading partner still remains China. Comparing the move to the Aussie’s reaction to a poor jobs report from Australia 1 hour beforehand, we’ll say it diminished. Moving forward, the U.S. CPI numbers will be released on Friday, which may hurt risk trend, along with the Aussie Dollar as bets for a possible rate hike remerges.