Aussie dollar bounces from near multi-year low on greenback weakness after China PMI

The Australian dollar has snapped a five-day losing streak that had taken it close to the recent six-year low in the previous session helped by broad weakness in the US dollar and after slightly better than expected Chinese PMI numbers.

The Australian housing market data that came on 1 April also was Aussie-supportive.

AUD/USD edged up to 0.7666 from the 31 March close of 0.7606. It had fallen to as low as 0.7590 in the previous session, just 30 pips away from the 11 March low, which was the Aussie dollar's weakest since May 2009.

Surveys of China's manufacturing and services sectors showed persistent weakness in the world's second-biggest economy in March, adding to bets that Beijing will have to roll out more policy support to avert a sharper slowdown.

The official Purchasing Managers' Index, released by the National Bureau of Statistics, rose to 50.1 in March from February's 49.9, as per the data published on 1 April. The market consensus was for a slight dip to 49.7.

Meanwhile, the NBS non-manufacturing PMI slipped from last month's 53.9 to 53.7, repeating the one-year low of January. In addition, the final manufacturing PMI by HSBC/Markit came in at 49.6, higher than a preliminary reading of 49.2, but still below the expansion/contraction mark of 50.

Analysts are viewing the data as supporting the case for additional stimulus by the world's second largest economy.

The NBS survey is more important as it takes larger, state-owned firms, while the HSBC survey is done among only small and mid-sized firms.

Building permits growth in Australia rose 14.3% from a year earlier in February, sharply higher than 9.1% in January, data showed on 1 April. Month-on-month, the number of permits fell 3.2% after recording a rise of 5.9% but less than analysts' forecast of 4.0% drop.

The US dollar was down also against other major currencies like the euro, pound and yen, pulling down the USD index off the 11-day high it fetched on 31 March.

The gauge dropped to 97.99 early 1 April in Asia from the previous close of 98.40, and the 31 March high of 98.66.