We are playing a bounce in the Aussie Dollar into year-end on a view that rates in Australia have bottomed but also clearly tethered to the rising data in China (FXI, quote).
Saturday night while you were turning your clock back, Chinese non-Manufacturing PMI hit 56.3 the highest in 12 months.
While there is not a high correlation of Chinese manufacturing to Aussie exports, still there is little questions China’s economy bottomed (for this cycle) in April.
We were active players in the short Aussie trade for 2 months from 1.05 area through .9200.
Getting through the .9650 level will be a ticket to 1.02.
