Australian Dollar Weakest After Manufacturing PMI Logs Record Drop

The Australian dollar was the weakest currency on the Forex market today, falling against all other most-traded rivals, even its commodity counterparts. The Aussie has started to decline yesterday and accelerated the drop after the manufacturing index demonstrated a record slump.
The Australian Industry Group Australian Performance of Manufacturing Index plunged from 53.7 in March to 35.8 in April. The extremely low figure indicates that the industry was contracting with the fastest pace since April 2009. Furthermore, the drop in the indicator was the steepest in the history of the survey. The sharp spike in March was the result of the hoarding of manufactured food and groceries. But the panic buying has subsided, and the April report revealed the disastrous impact of the COVID-19 pandemic. The report said:

Manufacturers cited a range of COVID-19 issues in April, with the most prevalent including: no new sales due to shutdowns; major customers cancelling orders; supply chain problems with inter-state freight movements, and delays; and increased prices for raw materials. All activity indices plunged in April, with activity levels now reminiscent of the Global Financial Crisis (GFC) plunge in 2009.

The Australian Bureau of Statistics reported that the Producer Price Index rose 0.2% in the March quarter after increasing by 0.3% in the previous three months. Of course, the data shows the state of the economy before the pandemic and the lockdown measures aimed to contain it came into full effect. That makes the data somewhat outdated and of limited use for investors.
According to data from the Reserve Bank of Australia, the Index of Commodity Prices dropped by 8.1% in April after falling by 10.7% in the preceding month. The drop was led by lower coal, oil, iron ore, and alumina prices.
AUD/USD dropped from 0.6508 to 0.6449 as of 10:14 GMT today. EUR/AUD rallied from 1.6816 to 1.7033. AUD/NZD declined from 1.0622 to 1.0605, and its daily low was at 1.0583.

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Original from: www.earnforex.com