Aussie weaker ahead of Q2 China GDP, industrial output
The Aussie trended weaker ahead of second quarter China GDP on Monday expected to set the tone for demand for commodities.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was fell 0.04% to 94.86.
China releases second quarter GDP with a gain of 1.7% seen on quarter and a 6.8% pace seen on year. At the same time, China expects industrial production likely gained 6.2% on the quarter and retail sales rose 10.6% in June. AUD/USD traded at 0.7823, down 0.09% with China a top trading partner for energy, metal and food commodities, while USD/JPYchanged hands at 112.44, down 0.09% as well.
On Thursday the European Central Bank meeting will provide fresh clues on when the central bank will shift away from its ultra-easy policy. Markets in Japan are shut on Monday for a holiday.
In testimony before Congress on Wednesday, Fed Chair Janet Yellen said the economy is on a strong enough footing for the Fed to raise rates and begin winding down its massive bond portfolio.
However she also reiterated that inflation is below target and noted that it is a particular “uncertainty” that could affect monetary policy.
The Australian dollar surged to an almost 15-month high, with AUD/USD jumping 1.28% to 0.7829 in risk-on trade as global stock markets hit record highs. The New Zealand dollar was also higher.