SYDNEY: The Australian dollar weakened against the other major currencies in the Asian session on Monday after data showed that the manufacturing sector in China moved further into contraction territory in April.
Data from the HSBC Bank showed that the manufacturing sector in China moved further into contraction territory in April, with a PMI score of 48.9. This missed forecasts for 49.4 and was down from last month’s preliminary reading that suggested a score of 49.2.
Traders await the Reserve Bank of Australia’s rate decision on Tuesday. Economists expect the bank to cut rates by 25 basis points to a new record low of 2.00 percent.
Global factors, such as weakness of the U.S. economy and the continuing quantitative easing programs of Europe and Japan, weighed on the currency.
Meanwhile, falling commodity prices also put pressure on the currency.
In other economic news, the Australian Bureau of Statistics showed that the total number of building permits issued in Australia was up a seasonally adjusted 2.8 percent on month in March, standing at 19,419. That topped forecasts for a decline of 1.5 percent following the 3.2 percent contraction in February.
On a yearly basis, building permits surged 23.6 percent – also topping expectations for an increase of 16.7 percent following the 14.3 percent spike in the previous month.
Consumer prices in Australia are expected to have decelerated in April, the latest survey from TD Securities and the Melbourne Institute showed. Inflation is forecast to have slowed to 0.3 percent on month after it was called at 0.4 percent in March. On a yearly basis, consumer prices are tipped to slow to 1.4 percent from 1.5 percent in the previous month.
