(CN) China President Hu indicated that China will offer $10B in loans to Shanghai Cooperation Organization member states and the China Transport Institute indicated increased spending on its rail infrastructure.
(AU) AUSTRALIA MAY UNEMPLOYMENT RATE: 5.1% V 5.1%E; EMPLOYMENT CHANGE: 38.9K V 0.0KE; PARTICIPATION RATE: 65.5% V 65.2%E (highest since Nov 2011).
How to interpret these headlines?
PBoC rate cut surprised the market today and it was released just one minute before the BOE (Bank Of England) Rate Decision, stealing the thunder away from the British and boosted market risk appetite sentiment. Along with the surprise rate cut, China also has plans to stimulate 7 key areas of its infrastructure and are likely to support its market to endure the slow growth and in turn, help AUD to remain in demand, especially considering recent blockbuster Australian employment and GDP releases. As a matter of fact, based on recent data, I believe AUD is no longer a SELL on Rally currency, but we may very well see more demand as global central banks race to depreciate their currency in order to boost competitive edges.
PBoC Rate Cut Surprise Boosts Risk Appetite
June 7, 2012 by 4 Comments