Concerns over a slowing Chinese economy dragged the Aussie dollar to a nine-month low, just as hedge funds were turning the most bullish they have been on the currency so far this year, according to a report by Bloomberg.
The report cites data from the Commodity Futures Trading Commission (CFTC) as revealing that the positioning of leveraged funds in the Aussie swung to a net-long of 17,432 contracts in the week ended 8 August from a net short in the previous week. At the same time, the Aussie fell by as much as 0.6% to 64.57 US cents, the weakest since November as China’s worsening property slump raised concerns over a further slowdown in the world’s second-largest economy.
The Aussie currently sits near the bottom of this month’s Group-of-10 currency performance rankings on the back of disappointing growth in China – the world’s biggest commodities importer – and a widening rate differential with the US. According to the Commonwealth Bank of Australia, the currency is likely to remain under pressure with key Australian jobs and Chinese industrial output, as well as retail sales, data due this week.
