Shutterstock photo
Markets

Forex - Aussie gains in early Asia after China weekend reserve ratio cut

Shutterstock photo

Shutterstock photo

Investing.com -

Investing.com - The Australian dollar gained in early Asia on Monday after top trading partner China moved at the weekend to kickstart growth by easing monetary policy.

AUD/USD traded at 0.7802, up 0.19%, while USD/JPY changed hands at 118.94, flat. EUR/USD traded at 1.0798, down 0.09%, while NZD/USD was quoted at 0.7698, up 0.15%, ahead of price data.

At the weekend, the People's Bank of China cut its reserve requirement by a full percentage point to 18.5% from 19.5%, the second cut in two months, adding more liquidity to the world's second-biggest economy to help spur bank lending.

Ahead, New Zealand reports consumer prices for the first quarter with a drop of 0.2% expected quarter-on-quarter and an annual rate of a 0.2% gain.

The U.S. dollar index, which measures the greenback's strength against a trade-weighted basket of six major currencies, was quoted at 97.67, up 0.05%.

Last week, the dollar ended lower against a basket of other major currencies on Friday as investors pushed back expectations for higher U.S. interest rates after a recent run of soft economic data dampened optimism on the recovery.

The dollar shrugged off data on Friday showing that U.S. consumer prices were higher for a second successive month in March.

The Labor Department reported that the consumer price index edged up 0.2% last month, matching a similar gain in February. On a year-over-year basis, consumer prices dipped 0.1% in March after remaining flat in February.

Core consumer prices, which exclude food and energy costs increased 0.2% in March for an annual increase of 1.8%, the largest since October.

The report came after data earlier in the week showed that U.S. retail sales for March came in below expectations. Another report, showing a larger-than-forecast drop in industrial output pointed to a slowdown the first quarter.

The single currency strengthened in spite of concerns that Athens is no closer to reaching an agreement on economic reforms for bailout funds with its creditors, fuelling fears that Greece could be forced out of the euro zone.

In the week ahead, investors will be looking ahead to reports on the U.S. housing sector and data on durable goods orders for further indications on the strength of the recovery.

In the euro zone, Tuesday's ZEW report on German economic sentiment and Thursday's reports on private sector activity will be in focus.

On Monday, Reserve Bank of Australia Governor Glenn Stevens is to speak at an event in New York.

Investing.com offers an extensive set of professional tools for the financial markets.

Read more News on Investing.com and download the new Investing.com apps for Android and iOS!

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

ForEx