Aussie stays steady in tight range against dollar after RBA kept cash rate unchanged at 2.00% as widely expected. The central bank maintained a neutral bias and noted that "further information on economic and financial conditions" are needed to determine the assessment of outlook and monetary policy. Regarding recent turmoils in the financial markets, RBA sounded calm and noted "equity markets have been considerably more volatile of late, associated with developments in China, though other financial markets have been relatively stable." Also released from Australia, building approvals rose 4.2% mom in July, current account deficit widened sharply to AUD -19.0b in Q2. From New Zealand, terms of trade index rose 1.3% qoq in Q2.
Asian markets are generally lower following downbeat data from China. The official manufacturing PMI dropped to 49.7 in August, hitting the lowest level in three years. The National Bureau of Statistics noted that "there is insufficient growth momentum in the country's manufacturing sector." The official non-manufacturing PMI dropped to 53.4. The Caixin PMI manufacturing was revised slightly higher to 47.3but that's still the worst reading in more than six years. The Caixin PMI services dropped sharply from 53.8 to 51.5. PBoC fixed yuan higher at 6.3572 per dollar today, equivalent to 0.2% appreciation. The Shanghai composite is trading -1% at the time of writing.
Looking ahead, PMI data will be the main focus today. In particular UK PMI manufacturing and US ISM manufacturing. Other data to be watched include PMIs in Eurozone, unemployment rate, Canada GDP and construction spending.