The Chinese GDP And The Aussie
Written by A Forex View From Afar on Thursday, April 16, 2009During Thursday’s trading session, the aussie was outperformed by every other major currency. So far, the main reason seems to be that demand for raw materials is likely to fall as the Chinese economy grew at a slower speed than expected.
“Commodities make up the biggest percentage of the Australian export market. As such, the aussie is very vulnerable to any change in the raw materials demand outlook.” TheLFB-Forex.com Trade Team members said. “Raw materials exports make up 35% of the balance of payments. Additionally, out of the top 10 merchandises exported by Australia, seven are raw commodities.” TheLFB-Forex.com Trade Team added
To further strengthen the case, China is the largest export market for Australian exports, so it is easy to understand why the weaker than expected Chinese Q1 GDP had the strongest effect over the Australian currency.
The Australian dollar lost 80 pips against the greenback, after managing to break above the Wednesday’s high during Thursday’s Asian session, while it lost 85 pips against the yen. However, the aussie’s positive days are far from over. The currency will rally when the commodity market actually starts moving higher.
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