Aussie Dollar Supported by Strong Commodity Gains

AUD-USD logged a 10-month high as the Aussie benefits from risk appetite along with a relatively robust domestic economy and comparatively less dovish/hawkish RBA polocy outlook. The AUD has at the same time come within a fraction of the nine-month best it made against the EUR last week and has made upside against the JPY and other currencies. Supportive for the Aussi was today’s solid China PMI data and the not unassociated firm commodity prices, with copper rising to a 10-month high and other Australia-relevant base metals, such as zinc, rising too. Oil and gold also edged higher. Meanwhile, on the domestic front, Australian manufacturing PMI rose 6.1 pts in July to 44.5, rising for the third month in a row and the highest levels since September 28 (though the index remains below the 50.0 contraction-expansion level). Employment in Australia remains soft however with the ANZ job ads falling 1.7% in July from June and is down 51.9% than a year ago. Note that RBA watcher Ross Gittens cautioned that the market may be getting ahead of itself on RBA rate hike expectations. AUD-USD bids are currently reported at 0.8360 and 0.8315/20.