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AUD/USD remains depressed as China PMI misses estimates

  • China’s PMI data prints below estimmates, fails to boost risk sentiment. 
  • AUD/USD trades at session lows with dollar attracting haven flows. 
  • President Trump’s comments on China and trade weigh over risk assets.

AUD/USD continues to trade in the red with China data failing to provide a positive surprise.

China’s NBS or government Manufacturing PMI, which mainly focuses on the state owned enterprises, came in 50.8 at versus expectations for 51 and down from March’s 52.00. A reading above 50 represents expansion in the activity, while a below-50 reading represents contraction. 

The decline from 52 to 50.8, indicates a slowdown in the pace of expansion in China’s manufacturing sector.

The data released at 1:00 GMT has so far failed to have a notable impact on the Aussie dollar, a proxy for China, leaving the AUD/USD pair at session lows near 0.6536. 

The pair found offers while trading near 0.6558 about 30 minutes ago after President Trump said that the trade deal with China has been upset badly due to the coronavirus outbreak. “China will do anything to have me lose the 2020 election,” added Trump, while talking to Reuters. 

Trump’s comments on China and trade weakened the risk sentiment and strengthened the haven demand for the US dollar. At press time, the futures tied to the S&P 500 are reporting a 0.10% loss. 

The risk-off, however, is unlikely to worsen, as the Federal Reserve, on Wednesday, said that rates will remain at 0 to 0.25 percent until it is confident that the economy is clear of the pandemic impacts. Further, the US-based Gilead medicines provided positive news on its coronavirus vaccine during the overnight trade.

Technical levels

 

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