AUD/JPY rises above 94.00 following PMI data from both countries

AUD/JPY gains momentum as Australia’s Judo Bank Manufacturing PMI climbs to 52.6 in March from 50.4 in February.
The Australian Dollar strengthens on expectations that the Reserve Bank of Australia will keep interest rates unchanged in April.
The Japanese Yen weakens as disappointing Jibun Bank PMI data weighs on sentiment.

Akhtar Faruqui FXStreet

AUD/JPY halts its four-day losing streak, trading near 94.20 during early European hours on Monday. The currency cross gains as the Australian Dollar (AUD) strengthens following the release of upbeat preliminary Judo Bank PMI data.

Australia’s Judo Bank Manufacturing PMI rose to 52.6 in March from 50.4 in February, while the Services PMI improved to 51.2 from 50.8. The Composite PMI also climbed to 51.3, up from 50.6 previously.

The AUD gains further traction amid expectations that the Reserve Bank of Australia (RBA) will hold interest rates steady in April after cutting borrowing costs for the first time in four years in February. Additionally, optimism surrounding potential Chinese stimulus supports the Australian economy, given the close trade relationship between the two nations.

The AUD/JPY cross also benefits from improved risk sentiment as the White House revises its tariff strategy ahead of the April 2 implementation, according to the Wall Street Journal. Geopolitical tensions have eased, with Ukrainian and US officials meeting in Riyadh on Sunday to discuss peace efforts, while President Trump continues to push for an end to the three-year war.

Additionally, the AUD/JPY cross appreciates as the Japanese Yen (JPY) remains under pressure as weaker-than-expected PMI data offsets the Bank of Japan’s (BoJ) hawkish stance. Japan’s Jibun Bank Services PMI declined to 49.5 in March from February’s six-month high of 53.7, marking its first contraction since October and the sharpest drop in nine months.

Meanwhile, the Manufacturing PMI slipped to 48.3 in March from 49.0 in February, missing expectations of 49.2 and extending its contraction streak to nine consecutive months. The Composite PMI also fell, dropping from 52.0 in February to 48.5 in March. Investors now await preliminary PMI figures for the Eurozone and Germany, due later in the day.

Economic Indicator

Judo Bank Manufacturing PMI

The Manufacturing Purchasing Managers Index (PMI), released on a monthly basis by Judo Bank and S&P Global, is a leading indicator gauging business activity in Australia’s manufacturing sector. The data is derived from surveys of senior executives at private-sector companies. Survey responses reflect the change, if any, in the current month compared to the previous month and can anticipate changing trends in official data series such as Gross Domestic Product (GDP), industrial production, employment and inflation. The index varies between 0 and 100, with levels of 50.0 signaling no change over the previous month. A reading above 50 indicates that the manufacturing economy is generally expanding, a bullish sign for the Australian Dollar (AUD). Meanwhile, a reading below 50 signals that activity among goods producers is generally declining, which is seen as bearish for AUD.

EUR/USD holds lower ground near 1.1850 ahead of EU/ US data

EUR/USD remains in the negative territory for the fourth successive session, trading around 1.1850 in European trading on Friday. A broadly cautious market environment paired with modest US Dollar demand undermines the pair ahead of the Eurozone GDP second estimate and the critical US CPI data.

GBP/USD keeps losses around 1.3600, awaits US CPI for fresh impetus

GBP/USD holds moderate losses at around 1.3600 in the European session on Friday, though it lacks bearish conviction. The US Dollar remains supported amid softer risk tone and ahead of the US consumer inflation figures due later in the NA session on Friday.

Gold trims intraday gains to $5,000 as US inflation data loom

Gold retreats from the vicinity of the $5,000 psychological mark, though sticks to its modest intraday gains heading into the European session. Traders now look forward to the release of the US consumer inflation figures for more cues about the Fed policy path. The outlook will play a key role in influencing the near-term US Dollar price dynamics and provide some meaningful impetus to the non-yielding bullion.