CANBERA (dpa-AFX) - The Australian dollar weakened against other major currencies in the Asian session on Wednesday, despite the releases of economic data from Australia and China.
Data from the Australian Bureau of Statistics showed that the Australia's consumer price inflation accelerated in August on higher housing and transport costs. Consumer price inflation rose to 4.0 percent from 3.5 percent in July. Inflation continues to remain above the central bank target range of 2-3 percent.
Nonetheless, inflation was slightly weaker than economists' forecast of 4.1 percent.
On a monthly basis, overall consumer prices rose 0.4 percent, following a 1.0 percent rise in July.
However, excluding automotive fuel and electricity, trimmed mean inflation remained at 3.6 percent for the third straight month in August.
Data came a day after the Reserve Bank of Australia raised its benchmark rate by a quarter-point to a 15-year high as some of the risks to inflation materialized. The board unanimously decided to raise the cash rate target to 4.60 percent, marking the third-rate hike since the beginning of the year.
Data from S&P Global showed that China's manufacturing and services sectors expanded at faster rates in September as robust new orders underpinned employment. The RatingDog China general manufacturing Purchasing Managers' Index rose to 52.1 in September from 51.5 in August.
The score was above forecast of 51.7 and also remained above the 50.0 no-change mark for the tenth straight month.
At the same time, the headline services PMI registered 51.6 in September, up from 51.4 in the prior month. The score suggested that activity grew at the fastest rate in three months and remained above forecast of 51.3.
The composite output index that combines manufacturing and services performances rose to 52.4 in September from 52.1 in the previous month. The private sector growth hit a three-month high.
Elsewhere, the official purchasing managers' survey data showed that China's manufacturing activity returned to the expansion territory in September. The factory PMI rose to 50.1, in line with expectations, from 49.8 in August.
The non-manufacturing activity also recovered in September, with the index rising 1.2 percentage points to 50.2, the National Bureau of Statistics said. The score was forecast to rise to 49.2.
Meanwhile, Asian stock markets traded mostly higher on Wednesday, despite the broadly negative cues from Wall Street overnight, as tumbling crude oil prices on easing supply concerns as Saudi Arabia restored half of the capacity of its East-West pipeline, allaying fears of global inflation and aggressive interest rate hikes.
Traders also remain reluctant to make significant moves ahead of the release of the closely watched US inflation data later in the day.
The inflation data could have a significant impact on the outlook for interest rates ahead of the Federal Reserve's next monetary policy meeting late next month.
In the Asian trading today, the Australian dollar fell to a 6-month low of 108.89 against the yen, from yesterday's closing value of 110.03. The aussie may test support near the 105.00 region.
Against the U.S. and the New Zealand dollars, the aussie slid to a 2-month low of 0.6959 and more than a 2-week low of 1.2329 from Tuesday's closing quotes of 0.6989 and 1.2392, respectively. If the aussie extends its downtrend, it is likely to find support around 0.66 against the greenback and 1.22 against the kiwi.
Against the euro and the Canadian dollar, the aussie slipped to more than 1-month lows of 1.6297 and 0.9877 from yesterday's closing quotes of 1.6227 and 0.9919, respectively. On the downside, 1.65 against the euro and 0.97 against the loonie are seen as the next support levels for the aussie.
Looking ahead, U.S. MBA mortgage approvals data, U.S. ADP employment data, U.S. core PCE price index for August, U.S. GDP data for the second quarter, personal income and spending data for August, U.S. retail and wholesale inventories data for August and U.S. EIA crude oil data are slated for release in the New York session.
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