Chinese Flash Manufacturing PMI is based on a survey of purchasing managers in the Chinese manufacturing sector. Respondents are surveyed for their view of business conditions in the manufacturing industry. A reading which is higher than the market forecast is bullish for the Australian dollar.
Here are all the details, and 5 possible outcomes for AUD/USD.
Published on Tuesday at 1:45 GMT.
Analysts are always interested in the views of purchase managers about the economy, as they are considered to be attuned to the latest economic and financial developments, and their expectations could be an indication of future economic trends. Thus, PMI readings are quite important and an unexpected reading could affect the movement of AUD/USD.
The index improved to 51.7 points in March, beating the estimate of 51.2 points. The April forecast stands at 51.4 points. Will the index meet or beat the estimate?
Sentiments and levels
This week’s tumble by the Aussie was long overdue, as Australian numbers have not impressed, and the RBA has been warning anyone who is listening that it is ready to cut rates further. The catalyst for the nosedive was weak Chinese GDP numbers, which will be bad news for Australia, as China is the country’s most important trading partner. With investors made more nervous by weak US numbers, we could see the Australian dollar continue to move lower. Thus, the overall sentiment is bearish on AUD/USD towards this release.
Technical levels, from top to bottom: 1.0508, 1.0416, 1.0326, 1.0260, 1.0174 and 1.0080.
- Within expectations: 48.0 to 54.0: In such a case, AUD/USD is likely to rise within range, with a small chance of breaking higher.
- Above expectations: 54.1 to 57.0: An unexpected higher reading can send the pair above one resistance line.
- Well above expectations: Such an outcome would likely push the pair upwards, and a second resistance line might be broken as a result.
- Below expectations: 51.0 to 53.9: A sharper decrease than forecast could push AUD/USD downwards and break one level of support.
- Well below expectations: Below 51.0: A very poor reading would likely hurt the Australian dollar. This outcome could push the pair below a second support level.
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