The australian dollar initially fell from 0.7070 to dip to the intraday low of 0.7040 (-30 pips) following the weaker than expected release of China's January Manufacturing PMI. However, market participants were quick to buy on the dips which pushed the aussie higher on a shortcovering rebound to the 0.7080 region. The market in Europe has otherwise been rangebound. (0.7080-0.7065).
China's official Manufacturing PMI fell to a three-year low of 49.4 in January versus the median estimate of 49.6 compared to 49.7 in the previous month of December. A number below 50 is indicative of contraction. China's manufacturing data has declined for a sixth month in a row that raises the likelihood of the PBOC to add monetary easing measures to stimulate economic growth in China's slowing economy.