FOREX-Aussie jumps after China data restores some currency volatility

* Q1 China GDP slightly above expectations, lifts Aussie

* Aussie surges vs dollar, scales 4-mth peak vs yen

* Stronger risk appetite weighs on dollar, helps euro bounce

* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh (Updates prices)

By Tom Finn

LONDON, April 17 (Reuters) - The Australian dollar rose to atwo-month high on Wednesday after Chinese economic growth beatforecasts and indicated to some investors that the worst is overfor the global economy.

The Aussie's jump encouraged some traders who have beensearching for direction recently after a lull in currencymarkets but the euro and dollar moved little, suggesting broadervolatility remained subdued.

The currency has been dogged by a dovish Reserve Bank ofAustralia but it rose above $0.72 for the first time since Feb.21, after data showed China's economy grew 6.4 percent in thefirst quarter. AUD=D3

Australia's dollar is sensitive to the economic fortunes ofChina, its biggest trading partner.

"It is becoming very clear again this morning what reallymatters for the Australian dollar is China. The currency is updespite the fact that the RBA rate meeting caused negativesentiment yesterday," said Esther Maria Reichelt, an FXstrategist at Commerzbank in Frankfurt.

On Tuesday, the Aussie took a brief hit after the RBA saidit believes a cut in interest rates would be "appropriate"should inflation stay low and unemployment trend higher.

The U.S. dollar, often a safe haven, sagged against the euroafter the Chinese data eased concerns about a global economicslowdown.

The dollar index .DXY against a basket of six majorcurrencies dipped 0.2 percent to 96.906.

The euro EUR=EBS rose 0.4 percent to $1.1324, paring theprevious day's losses.

The single currency came under pressure on Tuesday afterReuters quoted four sources with direct knowledge of discussionsas saying several European Central Bank policymakers think theECB's economic projections are too optimistic, as economicweakness in China and trade tensions lingers.

The New Zealand dollar was down 0.3 percent at $0.6739NZD=D4 .

The kiwi was hit after data showed New Zealand's annualinflation slowed in the first quarter, which raised the odds ofan interest rate cut in the coming months.

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

In This Story


Other Topics

Stocks World Markets Economy

Latest Politics Videos


Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More