-David de Ferranti, FXCM market analyst
The Australian Dollar weakened versus its major counterparts and remained steady thereafter on Monday as weak China's, Australia's biggest export partner, manufacturing and local economic data disappointed the markets. AUD/USD touched the Asian session high at 0.9290, and then subsequently falling to 0.9281, easing up 0.05%.
The service sector PMI came in at 48.6 for April, compared to upwardly revised reading of 48.9 for March, suggesting a faster rate of contraction in activity. Furthermore, the number of Australian home building permits declined in 3.5% March, the fifth monthly drop in the past half year. The data came against expectations for a 2.0% gain following a 5.0% drop seen in February. The Reserve Bank of Australia has cut rates eight times since late 2011 in an effort to spur activity in areas like retail and housing that have led previous expansions. The only positive news came from Australian labour market, as job advertisements rose for a fourth consecutive month in April, a further evidence that demand for labour is recovering. A poll by ANZ showed total job ads increased a seasonally adjusted 2.2% in April, from March, when they had soared 1.4%. Official employment data for April are due on Thursday and analysts look for a 6,750 gain after a couple of solid months. The unemployment rate is expected to tick up to 5.9% follow a surprising decline to 5.8% a month earlier.
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