Chinese industrial production numbers moved marginally higher in the latest reading and since early 2015 have maintained a solid pace of growth between around 5.5%-6.5%. While this is certainly lower growth figures to what we saw over the previous 10 years, it also suggests the Chinese economy is not as some 'experts' predict doomed. In fact China's resilience to continue to grow their economy and move toward a more consumer led economy appears well and truly on track, perhaps another reason why commodity prices have rebounded over the past 12 months.
Tonight sees the release of US CPI and retail sales figures ahead of the U.S Federal Reserve's latest interest rate decision tomorrow morning. And while it would appear that the market has priced in a 25 basis point rise in U.S interest rates to 1% we'll still have to wait and see how the market reacts if the Fed do raise again. From a purely economic view, the USD should rise if rates rise, and so the inverse is expected for AUD/USD. At the moment, AUD/USD is holding in the 0.75's but you'd have to think that 0.74's are more likely tomorrow should rates go up.
**Clients wishing to mitigate the risk of purchasing at a lower rate, may want to consider processing payments today ahead of tonight's announcements**
DATA RELEASES TODAY:
GBP - Unemployment Rate and Average Earnings at 8.30pm
USD - CPI & Retail Sales at 11.30pm
USD - Fed Funds Rate & FOMC Statement at 5.00am (tomorrow morning)
AUD EXCHANGE RATES:
AUD/USD – 0.7519
AUD/GBP – 0.6189
AUD/EUR – 0.7087
AUD/NZD – 1.0882
AUD/JPY – 86.341
***Above rates are indicative wholesale rates and intended as a guide only***
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