Flash: AUD in a mood to ignore positive news - RBS

FXstreet.com (Barcelona) - AUD continues to trade as a proxy for risk in China and Asia emerging markets, notes Greg Gibbs, FX Strategist at RBS, with the currency ignoring better-than-expected construction data today.

Key Quotes

"The Trading performance of the AUD in recent sessions has been poor reflecting the increasing uncertainty in China and the rhetoric by the RBA focussing on the expected decline in resources investment over the coming several years and desire for a weaker AUD to support investment growth in the non-resources sector."

"As yet there has been little spill over in policy tightening in China to iron ore prices that remain solid since August. Nevertheless, the AUD is suffering as the proxy for risk in China and Asian markets more generally."

"We move into an intense data period for the AUD over the next week, including GDP, housing activity, retail sales and external balance and trade data. The RBA in the midst of this decides on rates and is likely to remain firmly on hold but not ruling out further rate cuts."

"AUD appears in a mood to ignore positive news and react to more negative news."