01.04.201405:22:23UTC+00Aussie Surges Toward Four-Month High as China PMI Surpass Projections

Australia's dollar soared toward a four-month high and government bonds sagged down after a Chinese official manufacturing index empowered for the first time in five months.

Advances in the currency were capped as it moved toward so-called resistance in almost 93 U.S. cents and then 93.30, said David Greene, the Sydney-based head of dealing at AFEX, a global payment and risk-management firm. Traders may also stay cautious before the Reserve Bank of Australia declares the outcomes of its assembly today, with policy makers projected to maintain the key rate at a record-low 2.5 percent.

“The Aussie is pretty well bought,” Greene said. “With this better-than-expected number, the speculators out there might start to think that perhaps a big stimulus push for China is unlikely, potentially taking the wind out of the Aussie’s sails,” as it approaches strong resistance levels, he said.

Australia’s dollar inched up 0.1 percent to 92.76 U.S. cents as of 12:52 p.m. in Sydney. It skyrocketed to a four-month high of 92.95 on March 28. The Aussie rallied 0.2 percent to 95.77 yen. New Zealand's dollar escalated 0.2 percent to 86.76 U.S. cents and 0.1 percent to 89.57 yen.

China’s Purchasing Managers' Index climbed to 50.3 in March, the National Bureau of Statistics and China Federation of Logistics and Purchasing declared today. That compared with February’s 50.2 reading and the 50.1 median estimate from analysts in a Bloomberg News survey. Numbers over 50 indicates development.

Australian benchmark bonds pulled back, driving up yields, amid prospects the economy will gain advantage from stronger progress in China, the South Pacific nation’s largest trading partner. Ten-year yields increased five basis points to 4.14 percent, marching on track for the largest hike since March 20.