China Manufacturing Returns to Expansion; Antipodean Currencies Steady

BEIJING — Signs of stabilization in the world‘s second-largest economy emerged on Wednesday, as China’s official Manufacturing Purchasing Managers' Index (PMI) climbed back into expansion territory for the first time in eight months.

The index rose to 50.1 in December, beating the consensus forecast of 49.2 and up from the previous month's 49.9. The data provides a tentative signal that Beijing's recent stimulus measures may be beginning to filter through to the real economy.

Data Breakdown

The National Bureau of Statistics (NBS) report highlighted mixed underlying currents:

Forex Market Reaction

The response in localized currency pairs was positive but restrained, dampened by thin liquidity during the holiday period.

Analyst View

While the print of 50.1 is psychologically significant, it represents a stabilization rather than a boom. For the AUD, a sustained recovery requires consistent prints above 50 and evidence of a pickup in commodity demand—specifically iron ore and copper. Until then, the currency remains vulnerable to the broader strength of the US Dollar and global risk sentiment.