AUD/JPY Tumbles as China's Services PMI Surprises
The Australian Dollar (AUD) has been on a downward trend against the Japanese Yen (JPY) for four consecutive days, trading around 113.50 during Asian hours on Thursday. The mixed economic data from Australia and China is putting pressure on the AUD.
Australia's Trade Balance narrowed to A$1,923M in July, down from a revised A$2,341M surplus in the previous reading. This was largely driven by a 3.3% drop in Australian exports, reversing a 9.1% surge from the prior month.
In contrast, China's Services PMI showed a bright spot, climbing to 51.4 in August from July's 50.4 and outperforming the forecasted 50.6. Japan also saw strong momentum with its Jibun Bank Services PMI expanding to 52.5 in August, up from July's 51.2.
Strategists at BNY Mellon remain unconvinced that official efforts will translate into a materially stronger currency, stating they are 'deeply skeptical of the Japanese authorities' ability to boost JPY.' They point to comments from U.S. Treasury Secretary Scott Bessent, who remarked on Tuesday that 'Abenomics was reflationary, Japan can sit back and enjoy.'