Australia's Manufacturing Purchasing Managers Index beats consensus of 49.8

The Manufacturing Purchasing Managers Index has been released arriving at 51.2 vs a consensus of 49.8 and prior 49.8.

The data had no effect on the Aussie which is otherwise consolidation the overnight flows which sent AUD/USD to test the 0.69 level from 100 pips lower at the start of the day. 

Australian manufacturing conditions showed some modest improvement in June, according to the headline PMI figure, as the country relaxed its lockdown measures. The survey indicated a marked easing in the rates of decline in both production and new orders while confidence rose to a 16-month high on hopes of a further improvement in the coming months.

However, firms were reluctant to invest in new capacity, and instead reduced employment and input purchasing in June to contain costs. The headline index from the survey, the seasonally adjusted Commonwealth Bank Manufacturing Purchasing Managers’ Index (PMI) rose sharply from a record low of 44.0 in May to 51.2 in June,

Commonwealth Bank of Australia explains in a full report. 

AUD/USD Forecast: Holding in range, bulls still surging on dips

For the day ahead, should the Caixin Manufacturing PMI’s beat to the 50.5 forecast, versus 50.7 prior, bulls could take the pair even higher in a risk-on theme.

Description of the Manufacturing Purchasing Managers Index

The Manufacturing Purchasing Managers Index (PMI) released by both the Commonwealth Bank of Australia and the Markit Economics captures business conditions in the manufacturing sector. As the manufacturing sector dominates a large part of total GDP, the Manufacturing PMI is an important indicator of business conditions and the overall economic condition in Australia. A result above 50 signals is bullish for the AUD, whereas a result below 50 is seen as bearish.

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