The Australian Dollar has strengthened against the Pound and is set to make its biggest weekly gain since 2011 after it continues to benefit from the upbeat data out of China and increased demand for commodity based assets.
The rise comes despite the Reserve Bank of Australia revising down its growth expectations. In its latest Gross Domestic Product report it said that it expects the economy to grow by 2.25% by December 2013, compared to its previous forecast of a 2.5% increase.
“The RBA reduced the growth forecasts for the economy so that the ‘Aussie’ pulled down but then immediately bounced back up, it wasn’t enough to push the Australian Dollar lower, so it looks like we’ve run out of sellers,” said currency dealer Milica Nikolic.
Traders chose to largely ignore that information; instead they focused on the data out of China which showed that industrial production Growth increased by 9.7% in July, smashing forecasts of an 8.9% rise. Other figures showed that Chinese inflation held steady at 2.7% on a year-by-year basis in July, which could give the Chinese authorities some breathing space when it comes to monetary stimulus.
“The industrial production number was the one that everyone was looking for; it’s been a good read on the real economy and it blew expectations out of the water,” said Chris Weston chief market strategist at IG Markets Ltd. “This is good news for Australia.”
The currency looks likely to rise further over the weekend with some economists expecting it to reach as high as 92 cents against the US Dollar.
Current Exchange Australian Dollar (AUD) Rates
< Lower > Higher
The Australian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9158 >
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6841 >
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5888 >
The Australian Dollar/ New Zealand Dollar Exchange Rate is currently in the region of: 1.1414 >
The US Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.1091 <
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4616 <
The Pound Sterling /Australian Dollar Exchange Rate is currently in the region of: 1.6983 <
The New Zealand Dollar/Australian Dollar Exchange Rate is currently in the region of: 0.8761 <
Correct as of 10:15 am GMT
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