The Australian dollar rose in early trading as investors reacted to the latest Reserve Bank of Australia (RBA) interest rate decision and PMI data from China and Australia. The RBA left the interest rate and quantitative easing policies unchanged and upgraded the country’s GDP numbers. Earlier data showed that building approvals fell by 8.6% month-on-month in April while business inventories increased by 2.1% in the first quarter. The country’s current account rose from $A14.5 billion in the fourth quarter to A$18.3 billion in the first quarter. Still, the biggest challenge for the Australian economy is another lockdown in Victoria.

The Chinese manufacturing gathered steam in May as global demand rose. According to Caixin and Markit, the manufacturing PMI rose from 51.9 in April to 452.0 in May this year. This was a better reading than the median estimate of 51.9. The growth was mostly due to the rising demand for the country’s goods from around the world. Manufacturers were optimistic about the future, leading to higher employment figures. However, the key challenges facing them are that the Chinese yuan has strengthened substantially recently and that commodity prices have been elevated.

The economic calendar will be quite eventful today. Some of the key events to watch will be the UK house price index by Nationwide and the Swiss GDP and retail sales numbers. Analysts expect the data to show that the Swiss economy contracted by 0.5% quarter-on-quarter and by 0.2% year-on-year. Markit will also publish the global manufacturing PMI numbers from around the world while Eurostat will publish the preliminary consumer price index (CPI) data. In Canada, the statistics agency will publish the latest GDP data while Fed’s Randal Quarles will deliver a speech.

AUDUSD

The AUDUSD pair rose before and after the RBA interest rate decision. It rose to 0.7767, which was the highest level since May 26. On the four-hour chart, the pair has moved above the 25-day and 15-day moving averages. It is also approaching the upper side of the rectangle channel at 0.7817. Still, it also seems to be forming a head and shoulders pattern. Therefore, there is a likelihood that the pair will soon drop below the neckline of this pattern at 0.7690.

EURUSD

The EURUSD pair rose to an intraday high of 1.2232, which is slightly below the year-to-date high of 1.2267. On the four-hour chart, the pair is above the ascending trendline shown in pink. It has also moved above the 25-day moving average while the awesome oscillator has moved above the neutral level. The pair may keep rising as bulls attempt to move above the year-to-date high.

USDCHF

The USDCHF pair retreated ahead of the latest Swiss GDP data. The pair dropped to 0.8955, which was slightly below the important resistance at 0.9030. On the hourly chart, the pair has moved below the 25-day moving averages while the signal and main lines of the MACD have moved below the neutral level. The pair also seems to be forming a head and shoulders pattern. This means that the pair will likely break out lower after the latest Swiss GDP data.