Australian Dollar Rises As Asian Shares Traded Higher

(RTTNews) - The Australian dollar strengthened against other major currencies in the Asian session on Monday, as investors reacted positively to raising optimism about the health of the world's second-largest economy after data showed Chinese manufacturing activity unexpectedly expanded in August.

Data showing an increase in the unemployment rate in the U.S. has also added to optimism the Federal Reserve will leave interest rates unchanged later this month, but traders continued to express some uncertainty about future meetings.

In economic news, data from the Australian Bureau of Statistics showed that the Australia's household spending declined for the first time since 2021 in July amid the cost-of-living crisis. Household spending dropped 0.7 percent in July from a year ago, in contrast to the 2.2 percent increase in June. This was the first decline since February 2021.

Another data from the ABS showed that business inventories decreased 1.9 percent sequentially in the June quarter, confounding expectations for an increase of 0.4 percent.

Company gross operating profits registered a double-digit annual decline of 13.1 percent, which was worse than forecast of 1.9 percent drop.

In the Asian trading today, the Australian dollar rose to a 1-month high of 1.6659 against the euro and a 4-day high of 94.64 against the yen, from Friday's closing quotes of 1.6692 and 94.32, respectively. If the aussie extends its uptrend, it is likely to find resistance around 1.62 against the euro and 96.00 against the yen.

Against the U.S., the Canada and the New Zealand dollars, the aussie advanced to 0.6475, 0.8797 and 1.0877 from last week's closing quotes of 0.6450, 0.8768 and 1.0842, respectively. On the upside. 0.67 against the greenback, 0.90 against the loonie and 1.09 against the kiwi are seen as the next resistance level for the aussie.

Looking ahead, Swiss GDP growth rate for the second quarter and Eurozone Sentix investor confidence for September are due to be released in the European session.

At 9:30 am ET, European Central Bank President Christine Lagarde is set to speak at a seminar organized by the European Economics & Financial Centre, in Frankfurt, Germany.