Chinese PMIs Show Tentative Economic Recovery
AUD
The Aussie Dollar opens mixed against the major currencies after a mixed performance from both commodities and Chinese economic data on Friday. Chinese PMIs showed that their manufacturing sector was recovering slightly, while a worse-than-expected result in their non-manufacturing sector showed a plateau in activity. China's economy has been showing tentative signs of recovery since October after a raft of stimulus measures including interest rate cuts were announced in September. Locally, we had Private Sector Credit m/m released above expectations, the ASX closed -0.1% and commodities were mixed across the board including Gold +0.4% and Iron Ore -0.6%. Today, monthly Australian Retail Sales figures will be released, expected to improve from 0.1% to 0.4% month-on-month. The next major news piece will be our quarterly GDP numbers, which will be released on Wednesday.
USD
The AUDUSD opens slightly higher at 0.6511 as markets continue to evaluate the possible extent and consequences of President-elect Trump’s proposed tariffs. No economic data was released by the USA over the weekend due to their Thanksgiving holiday. Wall Street ended its strongest month of 2024, with the Dow Jones +0.4%, S&P500 +0.6% and Nasdaq +0.8% on Friday. Tonight will have the ISM Manufacturing PMI. The headline figure is expected at 47.7, meaning further contraction in the manufacturing sector, albeit at a slower pace than previously. Additionally, Federal Reserve Members Waller and Williams will be speaking.
EUR
The AUDEUR opens slightly higher at 0.6164 after Eurozone inflation expectations printed at 2.7% on Friday, slightly missing expectations of 2.8%. German retail data were mixed and French economic data was slightly weaker than expectations. The DAX closed +1.0% and the CAC closed +0.8%. Tonight will see manufacturing data announced for Spain, Italy, France and Germany as well as the Eurozone Unemployment Rate, with expectations that it will remain at 6.3%. No major data will be released for the rest of the week, but ECB President Lagarde will be speaking Thursday morning.
GBP
The AUDGBP opens slightly lower at 0.5102 with Bank of England’s Governor Bailey speaking on Friday night, mentioning how geopolitical risk remained elevated and how English credit supply was at a slight risk if a correction happened. The FTSE ended Friday +0.1% and there were no UK data releases over the weekend. Today will have monthly house price growth, expected to increase by 0.2% from last month. Later this week, Governor Bailey will be speaking Wednesday night and construction data will be released Thursday night.
NZD
The AUDNZD opens lower at 1.1004 as New Zealand tempered expectations of larger interest rate cuts, delivering a 50bps reduction last week. The Kiwi’s Building Consents growth for the month was announced at -5.2% this morning and their quarterly Overseas Trade Index will be released tomorrow.