The Australian Dollar is quietly falling. Overview for 10.12.2019

On Tuesday morning, AUDUSD is retreating affected by the statistics from Austalia and China.

The Australian Dollar is “losing weight” against the USD on Tuesday. The current quote for the instrument is 0.6825. 

Today’s statistics from Australia showed that the NAB Business Confidence dropped to 0 points in November after being 2 points in the previous month. The indicator is calculated based on the survey results of staff of the largest Australian companies excluding the agricultural sector. Readings above zero mean optimism, otherwise – pessimism. 

Chinese inflation reached the highest level since 2012 and now equals 4.5% y/y after being 3.8% y/y in October. However, the actual reading matched the expected one, because the inflation was predicted to increase earlier. The key reason was pork:  after the Montgomery swine flu outbreak, the market suffered from pork shortage, thus increasing the CPI. On YoY, pork prices added 110%, on MoM – 3.8% after expanding by 20.1% the month before. 

The inflation target for China is 3%.

There is an assumption that in order to lower the inflation pressure on the country’s economy, the People's Bank of China may devalue the Yuan.

All processes in the Chinese economy are important for Australia because China is its key trade and economic partner.