Monday morning in Asia, the Australian dollar fell against most major currencies after China announced on Sunday that it has lowered its annual economic growth target for the 2011-15 period to 7%.
China is Australia’s biggest trading partner, buying huge amounts of its major exports of iron ore, coal and liquefied natural gas.
The Chinese premier Wen Jiabao indicated that the GDP target for the 12th Five-Year Program period of 2011-2015 was lower than the 7.5 percent target for the 11th Five-Year Program period of 2006-2010, during which time the Chinese economy grew at an annual rate of about 10 percent, according to the official Chinese news agency.
Most Asian stocks declined today amid lingering worries about the tension in the Middle East.
Australia’s benchmark S&P/ASX 200 index is currently trading at 4,819.40, down 17.10 points or 0.35 percent from its previous close. The broader All Ordinaries index is down 12.70 points or 0.3 percent at 4,912.2.
In economic news, the Australian Bureau of Statistics said that the value of inventories held by Australian businesses in the fourth quarter rose a seasonally adjusted 0.7% from the prior three months to A$145.9 billion. This missed analyst expectations for a 0.5% fall after a 0.9% decline in the prior quarter.
Meanwhile, company gross operating profits fell 2.1% from the prior three months to A$64 billion. This was again wide of analyst expectations for a 1% increase after a 15.3% surge in the third quarter.
The Australian dollar weakened against the currencies of US and Japan in early Asian deals on Monday. At present, the aussie is worth 1.0125 against the greenback and 82.70 against the yen, down from Friday’s close of 1.0179 and 83.16, respectively. If the aussie slides further, it may likely target 0.998 against the greenback and 81.9 against the yen.
Industrial production in Japan climbed a seasonally adjusted 2.4 percent in January compared to the previous month. However, that was below expectations for an increase of 4.0 percent following the revised 3.3 percent increase in December. On an annual basis, industrial production climbed 4.7 percent, again missing expectations for a 6.0 percent increase.
Retail sales in Japan jumped 4.1 percent in January compared to the previous month, sharply higher than analyst expectations for a 2.7 percent increase. On an annual basis, retail sales were up 0.1 percent, well above forecasts for a 1.5 percent decline.
During early Asian deals on Monday, the Australian dollar slipped to a 4-day low of 0.9904 against the Canadian dollar. This may be compared to last week’s close of 0.9956. On the downside, 0.988 is seen as the next target level for the Aussie.
The Australian dollar that closed Friday’s trading at 1.3556 against the New Zealand dollar declined to 1.3480 in early Asian deals on Monday. The next downside target level for the aussie is seen at 1.335.
New Zealand posted with a merchandise trade surplus of 11 million New Zealand dollars in January, Statistics New Zealand said today, or 0.3 percent of the value of exports. That was well above analyst expectations for a deficit of 25 million NZD following the 250 million NZD shortfall in December.
Looking ahead, Japan’s housing starts for January is due at 12:00 am ET.
German import price index, French PPI and the Eurozone CPI – all for the month of January are expected in the European session.
Across the Atlantic, U.S. personal income and spending, pending home sales – all for the month of January and Canada’s GDP for the fourth quarter are slated for release in the New York morning session.