Monthly Chinese growth figures released early yesterday showed that the industry had expanded – further signs that the economy seems to be back on track after stumbling at the start of this year. The result was a general risk appetite in the market, which saw the traditionally safe-haven Japanese yen lose ground. Conversely, the Australian dollar initially benefitted taking strength from the news from China, Australia’s biggest trade partner. It was also supported by sentiment from central bank policy-makers early yesterday morning, in which they eluded to a period of stability in interest rates but this morning poor trade balance figures reversed the trend and saw the Australian dollar weaken.
The South African rand weakened amid increasing concerns over an imminent steelworkers’ strike. The commodity-back economy is reliant on its production of metals and precious metals, and has only very recently seen the end of a platinum workers’ strike, which heavily impacted the country’s output. Further strikes could see the economy significantly weakened.
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