The Australian dollar slipped lower against its U.S. counterpart on Monday, after the release of disappointing Chinese manufacturing activity data added to concerns over a slowdown in the world’s second biggest economy.
AUD/USD hit 0.7044 during late Asian trade, the pair’s lowest since February 28; the pair subsequently consolidated at 0.7068, shedding 0.28%.
The pair was likely to find support at 0.7003, the low of February 28 and resistance at 0.7128, the high of February 28.
Data earlier showed that China’s official manufacturing purchasing managers’ index ticked down to 49.4 in January from 49.7 the previous month, compared to expectations for a slip to 49.6.
China is Australia’s biggest export partner.
Meanwhile, the greenback remained supported after the Bank of Japan’s unexpected decision to cut its deposit rate into negative territory as part of an ongoing effort to combat deflation.
The move highlighted the diverging monetary policy path between the Federal Reserve and other world central banks.
In addition, data on Friday showed that the U.S. economy grew at an annual rate of 0.7% in the fourth quarter, compared to forecasts for growth of 0.8% after 2% growth in the third quarter.
The U.S. economy grew 2.4% in 2015 the Commerce Department said, matching similar growth in 2014.
The Aussie was lower against the euro, with EUR/AUD gaining 0.41% to 1.5351.