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Forex - Aussie, yen hold gains as China CPI lower than expected

Published 09/08/2016, 09:38 PM
Updated 09/08/2016, 09:40 PM
Aussie holds gains
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Investing.com - The Aussie and yen held gains in Asia on Friday as China consumer prices came in lower than expected adding to recent fairly upbeat data from the country on trade and manufacturing.

AUD/USD traded at 0.7649, up 0.08%, while USD/JPY changed hands at 102.16, down 0.31%. China is a top trading partner for Australia and Japan.

In China CPI figures came in at a rise of 0.1% month-on-month for August, below the 0.3% gain seen, and at a 1.3% pace year-on-year, well under the 1.7% increase expected. PPI figures came in at a decline of 0.8% year-on-year, less than the 0.9% drop seen.

Before the China figures, Australia reported home loans data for July fell 4.2%, more than the 1.5% fall seen month-on-month, and housing finance up 0.5%, well below a previous gain on 3.2%.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, eased 0.12% to 94.93.

Overnight, the dollar trimmed losses against the other major currencies on Thursday, after data showed that U.S. jobless claims fell to a six-week low last week and after the European Central Bank refrained from implementing any additional stimulus measures at its policy meeting.

The U.S. Department of Labor said initial jobless claims in the week ending September 3 decreased by 4,000 to 259,000 from the previous week’s total of 263,000. Analysts expected jobless claims to rise by 2,000 to 265,000 last week.

At the conclusion of its policy meeting, the ECB raised its 2016 growth forecast to 1.7% from 1.6%, but slightly lowered its 2017 forecast from 1.7% to 1.6% at Thursday’s meeting.

ECB President Mario Draghi said current monetary policy is effective and the changes to the banks growth forecast are not so substantial as to warrant a decision to act.

The comments came after the central bank left its benchmark interest rate at a record-low 0.0%, in line with market expectations.

Draghi added that interest rates would remain at present or lower levels for an “extended time” so the recovery would not be derailed.

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