Expected Stimulus Measures By Chinese Policy Makers Pushes Australian Dollar Flight

Expected Stimulus Measures By Chinese Policy Makers Pushes Australian Dollar Flight

The Australian dollar performed well across various markets yesterday (i.e., 15 January 2019), and today it is trading at AUD/USD 0.7200 (approx.). The positive movement by the Australian dollar is mainly driven by the Chinese Yuan which also climbed up against the US dollar, and it is currently at ~ YEN/AUD 0.013.

As per the recent market buzz, it is expected that the Chinese policymakers may soon bring in stimulus measures to support the economy of their Country which is currently in the middle of a trade war with the US. Due to the expected stimulus measure in the Chinese market, both the Australian dollar and Chinese Yuan have gain strength recently.

Recently, China’s Vice Premier, Liu He accepted the invitation to visit Washington on January 30 and 31 to talk about ending the trade war. The Chinese Yuan was positively affected by this news as China has been struggling a lot in the current trade war with the US. The end of the trade war with the US will be good news for the Chinese economy. With the recent confirmation from China Ministry of Finance (MoF) and National Development and Reform Commission (NDRC) regarding value-added tax (VAT) cut has created a positive buzz about the Chinese economy. Further, these institutions have also pledged to accelerate infrastructure investment in China.

China being a leading importer of metal and minerals and Australia being a leading exporter of metal and minerals, any change in China’s market and economy can substantially affect the economy of Australia and its currency. Currently, the Chinese steel manufacturing industry is suffering from lower profit margins, and the amount of iron ore import in 2018 has also decreased as compared to 2017. Further, it is expected that the steel consumption in China may also decline in 2019, which could substantially affect the Australian Mining Industry which is a major exporter of iron ore to China.

China’s December export numbers also declined in December 2018 when compared to the previous corresponding year. These conditions have prompted Chinese policymakers to intensify its policy easing and stimulus measures in 2019.

Earlier in 2018, the US imposed import tariffs on billions of dollars’ worth of Chinese goods due to which the Chinese market was very much affected. In response, China also levied higher tariffs on US goods due to which the overall imports growth of China was affected.

The Australian investors need to keep a close watch on the expected stimulus measures which are soon going to be announced by the Chinese Policymakers, as any change in the Chinese economy is expected to prompt a change in the Australian Economy also.

The S&P/ASX200 index is slightly up by 0.2 percent today with biggest gainers Ausdrill limited and Bingo Industries limited which are 8.681 percent and 7.143 percent up, respectively.


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

Top 25 Dividend Stocks To Consider

People prefer a dividend stock in their portfolio as it possesses the feature of compounding. Compounding means that the earning which is generated through these dividend stock will get reinvested and will eventually create earnings from earning. More precisely, the dividend generated from these dividend stock will get reinvested to buy another set of a share of the dividend stock which results in giving a higher dividend.

Click here to download your top 25 dividend stocks report!

6 Cannabis Stocks under Investor’s Limelight…

Cannabis companies that sell both medicinal weed and recreational pot. Marijuana stocks to look at. Marijuana mergers and acquisitions. Dispensary data analytics. Upcoming marijuana IPO’s Those phrases have become increasingly common as marijuana legalization spreads.

Global spending on legal cannabis is expected to grow 230% to $32 billion in 2020 as compared to $9.5 in 2017, according to Arcview Market Research and BDS Analytics. As of June 29, 2018 the United States Marijuana Index, despite a lot of uncertainty around regulations, has over the past 1 year gained 71.49%, as compared to about 12% gain seen by the S&P 500.

Click here for your FREE Report

LEAVE A REPLY

Please enter your comment!
Please enter your name here