Forex Flash: AUD upside hinges on Chinese recovery – Danske Bank

Forex Flash: AUD upside hinges on Chinese recovery â€" Danske Bank

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Forex Flash: AUD upside hinges on Chinese recovery Danske Bank

FITITOL--> FXstreet.com (Barcelona) - Investors are well aware about the relevance for the Aussie economy of the events/indicators/decisions in China. The main reason behind the bearish trend in AUD/USD since early March â€" daily chart - is, well, the likeliness of a ‘hard landing’ in the Chinese economy, affecting mainly its demand for Australian exports rather than any weakness in the domestic fundamentals.

After today’s RBA rate cut to 3.75% and April’s NBS manufacturing PMI in China climbing to 53.3 from 53.1, A.L.Rasmussen, Chief Analyst at Danske Bank, suggests that the Aussie dollar is well posed to wait for a recovery in China along with his opinion that the Chinese economy could have reached the bottom of the abyss in the first quarter.

“AUD still offer a positive carry and is in our view one of the best ways to position for a Chinese recovery”, he concludes.