Forex Market Update: China’s GDP Data Weighs on Australian Dollar and Canadian Dollar, U.S. Dollar Falls against Yen

Following the release of unexpectedly weak Chinese GDP data, commodity currencies (currencies of those nations that are rich in natural resources) fell sharply on Monday.

Major commodity currencies such as Canadian dollar and the Australian dollar came under heavy pressure on Monday while other riskier assets, particularly industrial metals also traded sharply lower.

The Chinese GDP in the first quarter of the current year rose by 7.7% YOY compared to economists’ expectation for 8% growth. In the fourth quarter of 2012, the world’s second largest economy saw economic expansion of 7.9%.

Earlier today during Asian trading hours, the Australian dollar sank 1% against the U.S. dollar. The Canadian dollar also fell about 1% against the U.S. dollar, touching its lowest level since last 10 days.

“The China data and the fall in gold and silver is definitely pulling down the commodity currencies,” said Paul Robson, head of European currency strategy at the Royal Bank of Scotland in London, according to the Wall Street Journal.

Meanwhile the U.S. dollar continued to lose traction against the yen during European trading hours falling to 10 day low after falling in the Asian trading hours and drifting further away from 100 yen mark, which looked so imminent, last week.

At last check, the yen traded up 0.39% to trade at 97.86 to the U.S. dollar.

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Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.