AUDUSD recovers from a multi-day low due to encouraging data from a crucial client.

After initial disappointment from Australian bulls over domestic numbers early on Wednesday, the AUDUSD resumes efforts to recover early losses to around 0.6730.

The official and Caxin PMIs for China show positive results for February.

Caixin Manufacturing PMI for China increased to 51.6 from 50.2 anticipated and 49.2 for February. The private manufacturing activity indicator followed the official statistics in doing so. The China NBS Manufacturing PMI increased to 52.6 earlier in the day from 50.1 earlier and 50.5 market expectations. What’s more, the Non-Manufacturing PMI increased to 56.3 from the prior readings of 54.4 and 49.7, above analysts’ forecasts. See also: China’s Caixin Manufacturing PMI rises to 51.6 in February, above the anticipated 50.2.

Australian GDP and inflation numbers were unimpressive, and risk aversion for AUDUSD was at a recent low.

It’s important to note that Australia’s fourth-quarter (Q4) Gross Domestic Product (GDP) and Monthly Consumer Price Index both showed disappointing results (CPI) Data for January had already pushed the AUDUSD pair back near its two-month low. In relation to that, Australian Q4 GDP came in at 0.8% below forecast and at 0.6% below earlier estimates, albeit showing a 0.5% quarterly gain.

Nonetheless, the annual GDP growth equals the 2.7% market expectation, down from the previous 5.9%. The January monthly CPI data was shown on the same line and decreased to 7.4% from 8.4% in December and 8.0% predicted. In other markets, worries about more inflation and rising rates appear to have dampened investor confidence, driven up yields on US Treasury bonds, and put downward pressure on stock futures. The same is true of rumors that China’s President Xi Jinping is planning a significant revamp of government institutions and a substantial increase in the Bloomberg has noted friction between the US and China.

In conclusion, the AUDUSD encourages positive data from the primary customer to draw buyers, but the bullish bias is missing due to inflation fears and aggressive Fed concerns. For intraday directions, the US ISM Manufacturing PMI for February will be crucial.