China Federation of Logistic and Purchasing will release September month’s official PMI numbers around 01:00 GMT on Wednesday. Following that, Caixin will also release the current month’s Manufacturing PMI, up for publishing at 01:45 AM.
Given the key activity numbers from the biggest customer, AUD/USD traders will pay close attention to the PMI data for immediate direction. It should, however, be noted that the first round of the US presidential debate, scheduled for 1:00 GMT, can dim the market importance of otherwise crucial PMI data.
Market consensus signals the headline NBS Manufacturing PMI to increase from 51.0 to 51.2 while Non-Manufacturing PMI may recede from 55.2 to 52.1. Talking about the Caixin Manufacturing PMI figures, the activity gauge is expected to remain unchanged at 53.1 during September.
Ahead of the data, TD Securities said,
We expect China manufacturing PMI to increase to 51.3 in Sep from 51.0 in Aug, marking the 7th straight month of expansion, something that is increasingly being reflected in the hard data. The NBS manufacturing PMI now comfortably sits above pre-COVID levels, as an activity has rebounded in the wake of resilient export performance. However, there are some clouds on the horizon indicating a loss of momentum; steel prices are falling, as are refinery operating rates while coal stocks inventories are rising. Support for small and private manufacturers will likely keep the Caixin PMI elevated.
How could they affect AUD/USD?
With the AUD/USD pair currently trading near the highest levels in one week, around 0.7140 by the press time of early-Asian session trading on Wednesday, bulls should remain cautious even if the market consensus for scheduled data is mostly upbeat. The reason could be traced from the uncertainty surrounding the US political system and the recent trade wars of the US with China and the European Union (EU). If the data disappoints, bears will have an additional reason to reverse the recoveries from the lowest since July 20.
Technically, AUD/USD bulls are currently targeting a 50-day SMA level of 0.7205 prior to eyeing the previous support line stretched from August 03, at 0.7250 now. On the contrary, sellers won’t risk entries unless the quote slips below the 100-day SMA level of 0.7018 on a daily closing basis.
Key Notes
AUD/USD: Firmer above 0.7100 ahead of China PMI, US presidential debate
2020 US Elections Debate Preview: Eighty Percent of success is showing up
AUD/USD Forecast: Picking up bullish momentum
About the China NBS Manufacturing PMI
The Manufacturing Purchasing Managers Index (PMI) released by the China Federation of Logistics and Purchasing (CFLP) studies business conditions in the Chinese manufacturing sector. Any reading above 50 signals expansion, while a reading under 50 shows contraction. As the Chinese economy has an influence on the global economy, this economic indicator would have an impact on the Forex market.
About the China Non-Manufacturing PMI
The official non-manufacturing PMI, released by the China Federation of Logistics and Purchasing (CFLP), is based on a survey of about 1,200 companies covering 27 industries including construction, transport and telecommunications. It's the level of a diffusion index based on surveyed purchasing managers in the services industry and if it's above 50.0 indicates industry expansion, below indicates contraction.
About the China Caixin PMI
The Caixin China Manufacturing PMI™ is based on data compiled from monthly replies to questionnaires sent to purchasing executives in over 400 private manufacturing sector companies.
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