Forex News: Australian Dollar Rises On Upbeat PMI Data

Australian Dollar Rises On Upbeat PMI Data

(RTTNews) - The Australian dollar strengthened against other major currencies in the Asian session on Monday, after data showed that the manufacturing sector in Australia continued to expand in March, and at a faster pace.

Data from the S&P Global showed that the manufacturing sector in Australia continued to expand in March, and at a faster pace, with a manufacturing PMI score of 52.6.

That's up from 50.4 in February, and it moves further above the boom-or-bust line of 50 that separates expansion from contraction.

The survey also showed that the services PMI improved to 51.2 from 50.8 in the previous month, and the composite PMI went up to 51.3 from 50.6 a month earlier.

Some analysts predict the Reserve Bank of Australia (RBA) will maintain rates steady in April, after lowering borrowing costs for the first time in four years in February, which further strengthens the AUD. Additionally, the Australian economy is boosted by prospects of Chinese stimulus.

Trader's sentiment improved after U.S. President Donald Trump indicated he'd retain 'flexibility' when it comes to a reciprocal tariff plan expected on April 2.

However, Trump said during the same remarks in the Oval Office that providing exceptions for one country means "you have to do that for all," furthering the uncertainty about his plans.

In the Asian trading today, the Australian dollar rose to a 4-day high of 94.27 against the yen and a 6-day high of 1.0981 against the NZ dollar, from Friday's closing quotes of 93.60 and 1.0931, respectively. The aussie may test resistance around 97.00 against the yen and 1.11 against the kiwi.

Against the U.S. and the Canadian dollars, the aussie dropped to 0.6295 and 0.9020 from last week's closing quotes of 0.6269 and 0.8995, respectively. On the downside, 0.64 against the greenback and 0.91 against the loonie are seen as the next resistance levels for the aussie.

The aussie edged down to 1.7216 against the euro, from Friday's closing value of 1.7239. The next possible upside target for the aussie is seen around the 1.69 region. Looking ahead, PMI reports from various European economies and U.K. for March are slated for release in the European session.

In the New York session, Canada manufacturing sales data for February, U.S. Chicago Fed National Activity index for February and U.S. S&P Global PMI reports for March are set to be published.

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