The AUD/USD pair strengthened on Monday on the Chinese news and the quiet external background.
The Australian dollar at the beginning of the final week of October is trading on the upside in pair with its American counterpart. The current quote in the AUD/USD pair is 0.7250.
There are very little statistics today, and news that could have an impact on the currency market - even less. On Monday morning, it became known that the PBOC for the fifth time this year reduced the figure of the key rate. At the same time it also lowered reserve requirements for banks and financial institutions. Now, the annual interest rate on credit lines is 4.35% (-25 bps). For annual deposits the rate is 1.5% (-25 basis points). Standards for allocations to reserves for financial institutions dropped by 50 basis points.
This information indicates that the Chinese regulator continues to operate in the frames of the easing of monetary conditions in their economy in order to prevent its further deceleration. For Australia, which sees China as its key trade partner, this is good news.
Let me remind you that according to the latest data, China's GDP in the third quarter increased by 6.9%. This is slightly higher than the average market expectations, but much weaker than the previous reports.
RoboForex Analytical Department
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