Investing.com - The Aussie gained further on Tuesday in Asia as investors noted a better-than-expected private manufacturing PMI from China in an otherwise light regional day with markets in Japan closed though tweets from President-elect Donald Trump on North Korea's nuclear program gained attention.
"North Korea just stated that it is in the final stages of developing a nuclear weapon capable of reaching parts of the U.S. It won't happen!" Trump then chided China on trade and its diplomatic support to North Korea.
"China has been taking out massive amounts of money & wealth from the U.S. in totally one-sided trade, but won't help with North Korea. Nice!"
AUD/USD traded at 0.7220, up 0.46%, while USD/JPY changed hands at 117.40, down 0.09% on demand for safe-haven yen. Markets were rattled by tweets from Donald Trump suggesting a hard line against North Korea's plans to test an intercontinental ballastic missile capable of carrying a nuclear warhead that could reach the U.S. West Coast.
Earlier, the Caixin manufacturing PMI for December came in at 51.9, well above the expected 50.7 and a jump from 50.9 in November. At the weekend, data showed the official China PMI from the China Federation of Logistics and Purchasing and the National Bureau of Statistics fell to 51.4 in December, slightly weaker than expectations.
"A further rise in production at Chinese manufacturers supported the higher PMI reading in December. Notably, the rate of output growth accelerated to a 71-month high, with a number of panelists commenting on stronger underlying demand and new client wins," the Caixin data statement said.
"Data indicated that improved domestic demand was the key driver of new business growth, however, as new export sales were unchanged in December."
Overnight, the dollar regained momentum lost during the last two weeks against a basket of six major currencies on Monday.
In early Asia, the U.S. dollar index jumped 0.37% to 102.75e with many markets closed overnight.
The greenback finished 2016 at 14-year highs on market expectations that the Fed will increase rates three times this year, and that incoming President Trump will stoke growth and inflation with a program of investment in infrastructure.