The Australian dollar gained strength against other major currencies during the Asian session on Friday, following the report that China’s economy grew at its slowest rate in over a year for the third quarter.
According to data from the National Bureau of Statistics, China’s gross domestic product increased by 4.6 percent year-on-year in the third quarter, marking the most sluggish growth since the first quarter of 2023.
This rate aligned with expectations but fell slightly short of the 4.7 percent growth recorded in the second quarter.
On a quarter-on-quarter basis, GDP rose by 0.9 percent, which was below the anticipated growth of 1.0 percent.
From January to September, the economy achieved an annual growth rate of 4.8 percent, compared to the government’s full-year goal of approximately 5 percent.
In September, industrial production experienced a notable increase of 5.4 percent, following a rise of 4.5 percent the previous month. This figure also surpassed economists’ predictions of 4.6 percent.
Retail sales growth saw an improvement to 3.2 percent, up from 2.1 percent in the month prior, with sales expected to rise by 2.5 percent.
Fixed asset investment growth for the three-month period ending in September remained steady at 3.4 percent, consistent with the previous period.
The real estate sector continued to be the largest contributor to slowing growth, with property investment declining by 10.1 percent year-on-year.
The unemployment rate dropped to 5.1 percent in September, contrary to forecasts that predicted it would hold steady at 5.3 percent.
Market participants are concentrating on a potential rate cut by the European Central Bank, alongside expectations for interest rate reductions by the U.S. Federal Reserve and the Bank of Canada.
On Thursday, the Australian dollar appreciated against its major counterparts following a robust employment report released for September in Australia.
During today’s Asian trading session, the Australian dollar rose to a nearly two-week high of 1.6134 against the euro, up from the previous day’s closing of 1.6173. The aussie is expected to encounter resistance in the vicinity of 1.59.
Against the U.S. dollar and the yen, the aussie reached three-day highs of 0.6719 and 100.72, rising from Thursday’s closing prices of 0.6696 and 100.57, respectively. Should the aussie continue its upward trajectory, it may face resistance around 1.59 against the euro, 0.68 against the USD, and 102.00 against the yen.
In comparison to the New Zealand and Canadian dollars, the aussie climbed to a four-day high of 1.1067 and a three-day high of 0.9262, up from closing values of 1.1050 and 0.9236, respectively. The next likely target for upside movement is projected near 1.11 against the kiwi and 0.94 against the loonie.
Looking ahead, eurozone current account data for August is expected to be released at 4:00 am ET during the European session.
In the New York session, U.S. building permits for September, housing starts for September, and the Baker Hughes oil rig count data will be published.
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