AUD Holds Firm Amid Mixed Signals from China and US

The Australian Dollar has sustained its recent gains against the US Dollar despite China's Caixin Manufacturing PMI coming in slightly below market expectations.

China's factory activity expanded in April, but at a slower pace than anticipated. The slight miss in the data could have triggered a sell-off, yet the currency held its ground, indicating that investor sentiment is leaning towards risk-on.

The resilience of China's manufacturing sector has provided some relief to markets, which had braced for a more significant slowdown. The ongoing weakness in the US Dollar, fueled by expectations of interest rate cuts later this year, has been a significant tailwind for the AUD.