The Australian Industry Group Performance of Manufacturing Index rose 2.8 points to 53.8 – showing the sector expanded at the fastest pace in two years – led by stronger production deliveries growth. Although demand is lifting modestly, survey respondents continue to indicate the strong Australian Dollar and weak retail sales are constraining activity. Consumer related sectors including food and clothing saw lower levels of activity while sectors linked to the housing and resource sectors, including construction materials and transportation equipment, expanded at a solid pace. The outcome bolstered expectations that firming economic growth will see the Reserve Bank of Australia raise interest rates this week to check building inflationary pressure, with a Credit Suisse gauge of the priced-in forecast showing investors now see a 61% chance of a 25bps increase versus just 49% on Friday.
DailyFX provides forex news on the economic reports and political events that influence the currency market.
Learn currency trading with a free practice account and charts from FXCM.
