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    Aussie and Kiwi strengthen on strong Australia GDP and mixed Chinese data

    The greenback fell against the Japanese yen on Wednesday, weakening from Monday’s peak, while the Australian and New Zealand dollars strengthened following the release of strong Australian growth data and mixed manufacturing reports from China.

    The dollar fell 0.7% to 109.95 against the yen, pulling away from a one-month high reached on Monday. The yen’s rise came on a day when the Prime Minister Shinzo Abe is expected to announce a delay to a scheduled sales tax raise. The Japanese Prime Minister told members of his party on Wednesday that he will postpone the tax hike by two and a half years.

    The Aussie rose 0.54% to 0.7273 against the dollar, the highest level since the 18th of May 2016, after the Australian Bureau of Statistics reported on Wednesday that GDP advanced 1.1% in the three months to March, exceeding expectations for a 0.8% increase.

    The country’s economy grew by 0.75 in the fourth quarter of 2015, whose figure was downwardly revised from a previously estimated growth of 0.6%/ On a year-over-year basis, GDP rose by 3.1% in the first quarter, as opposed to expectations for a 2.8% increase.

    The New Zealand dollar also edged higher 0.31% to 0.6786 against the dollar, the highest since the 23rd of May. A report released from China earlier on Wednesday revealed that the country’s official manufacturing PMI index remained unchanged at 50.1 in May. Economists had expected a downtick to 50.0. In addition, China’s Caixin manufacturing PMI fell to 49.2 in May from 49.4 in April, exceeding expectations for a drop to 49.3.
     
    The U.S. dollar index was last steady at 95.75, still close to Monday’s two-month highs of 95.96.

    Overnight, the greenback inched down against its other major counterparts, after soft U.S. consumer confidence and manufacturing reports overshadowed other positive reports released earlier in the day.

    The U.S. Conference Board reported that its consumer confidence index dropped to 92.6 in May from 94.7 in April, whose figure was revised down from a previously reported 94.2 reading. Economists had expected the index to rise to 96.0.

    The report came after the Kingsbury International market research group said that its Chicago PMI fell to a three-month low of 49.3 in May from a 50.4 print in the previous month. Economists had expected the index to tick up to 50.9.

    Earlier in the day, the U.S. Commerce Department reported that personal spending rose by 1.0% in May, above expectations for a 0.7% increase. Personal spending for March inched up 0.1%. Personal income increased by 0.4%, in line with expectations and after rising by 0.4% in April.

    The EUR/USD fell 0.17% to settle at 1.1127, after the release of a report revealing that inflation in May for the eurozone fell by 0.1% on a year-over-year basis. In April, inflation fell by 0.2%.

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