Australian Dollar Outlook - 24 June 2014
Bell FX Currency Outlook: The Australian dollar remains above 0.9400 cents on the back of surprisingly strong Chinese manufacturing figures.
Australia: The Australian dollar shot up above 0.9400 on Monday, rallying as high as 0.9445 after the HSBC China manufacturing purchasing
managers' index for June came in at 50.8, up from May's 49.4 and well above expectations of 49.7. It was the first time since November 2013
that the index, which tracks activity in factories and workshops in the world's second-biggest economy, had come in above 50.
Majors: The USD marked time as industrial data around the world were in focus. Eurozone PMIs disappointed, the 'flash' composite reading falling to 52.8 from 53.5 and 53.4 expected, with both the manufacturing and service sector readings slipping back, taking its toll on the EUR.
Data released in the US, while second tier, continued to highlight that growth momentum there is improving and yields continued to creep higher, with the Markit version of the manufacturing PMI jumping to 57.5 from 56.4 (56.0 expected). Also significantly stronger than expected were US Existing home Sales, which came out at +4.9%, with April revised up to 1.5% from 1.3%. Gains were led by the single family sector. More evidence of a revival from the winter-weather hit, although it is too early to conclude that the housing sector is back in good health.
The USD will home into focus later in the week as the core PCE (the Fed's favored measure of inflation) is released, however Fed Governor Plosser's speech tonight will also be a focus.
Economic Calendar
24 JUN AU ANZ-Roy Morgan Consumer Confidence - 22 Jun
GE IFO Business Climate/Expectation Jun
US Consumer Confidence Index June
US Fed's Plosser speaks on Economic Outlook and Monetary
Policy