The currencies of China's trading partners such as the Australian and New Zealand dollars advanced on Monday after new announcements from Beijing on the revival of the Chinese economy. Around 7:15 p.m. GMT, the Australian dollar advanced 0.89% against the greenback, to $1.5508 «aussie» for one «buck»one of the nicknames of the motto of the United States. The New Zealand currency increased by 0.68%, to 1.7033 dollars. «kiwi»one of his nicknames, for one American dollar. At the same time, the yuan – whose price is controlled by the Chinese state – increased by 0.15%, to 7.2586 yuan per US dollar.
This upward movement in currencies is due to the announcement on Monday by members of the Political Bureau of the Central Committee of the Chinese Communist Party, a key decision-making body, of their wish to continue the recovery of the country and to adopt “a slightly relaxed monetary policy”. “We need to vigorously stimulate consumption, improve investment efficiency and comprehensively expand domestic demand”said officials cited by the state agency Xinhua.
Situations “intimately linked” to China
“This is a significant shift in China’s intentions to resuscitate its economy”commented to AFP Christopher Vecchio, from Tastylive. “Over the past fourteen years, the Central Bank of China (PBoC) has itself described the stance of its monetary policy as prudent, it is now moving towards a policy (…) moderately accommodative”added the analyst.
Dependent on the good economic health of China, the two countries' largest trading partner, the Australian and New Zealand dollars have gained ground as a result. “China is Australia’s largest trading partner, hence greater economic activity in China” is beneficial “for Australia”summarized M. Vecchio. “Australia is a major exporter of materials to China, and the situations (of the two countries) are closely linked”observed Adam Button of Forex.com.
