The Australian dollar is sharply lower today after poor data out of China which may once again force the Reserve Bank of Australia to cut rates.
AT 10.16am (GMT) the Aussie dollar was trading at US70.44c, down from US70.87c in yesterdays close.
The Chinese purchasing manufacturing index (PMI) came in at 47, a six year low and below last month’s figure of 47.3 with a number below 50 showing the sector in contraction.
The RBA should take note of this news as any slowdown in the Chinese economy is likely to flow through to the Aussie economy with less demand from China for commodities such as Iron ore, Australia’s biggest export.
The Australian dollar hit a key resistance level earlier in the day of US70.12c which is likely to hold up for the rest of the session due to a lack of data and another movement towards this level should create a buying opportunity for the Aussie currency.
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