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Coming to the point, yesterday that is on Tuesday Chinese economic data was finally revealed to the general public and the reports were according to expectation that showed a slower growth rate in the fourth quarter of 2015. Moreover, share prices in China climbed by 3% and real GDP grew by 1.6% between the third and fourth quarter. During the year 2015, GDP growth on average was around 6.9% however, the government of China had set the target of 7% for GDP.
Furthermore, if we compare GDP growth rate report of last four quarters, we can clearly see that it is the lowest GDP growth. In quarter 4 of 2014, GPD growth was 7.3%, in 2013 it was 7.7%, in 2012 it was 7.64% and in 2011 it was 8.1%.
After the reports were released we had witnessed a shift Forex currency trading. There was an increase in value of dollar against yen. Greenbacks recovered 0.6% against Japanese currency which is usually perceived as a safe heaven. Furthermore, dollar performed well against euro and it gained around 0.2%, EUR/USD pair was trading 1.0870.
On the other hand, we had also seen that Australian dollar gained against the US dollar. The Greenbacks fell by 1.10% relative to Australian currency to trade at 0.6834. Moreover, dollar fell by 0.7% versus the Canadian dollar. While Kiwi gained almost 0.2% and Yuan gained 0.1% versus the greenbacks. At the moment, dollar slipped against the Swiss Franc by 0.1% to trade at 1.0043.
Mark Carney, Governor of Bank of England, has not yet set any time period for rise of interest rate as he is still waiting to see the stronger growth rate and inflation before announcing new interest rate. Moreover, he also pointed out the political uncertainty in the current scenario and also indicated that slow Chinese economic growth will have a spillover effect. Meanwhile, sterling pound hit the lowest level against dollar since March 2009.
Annual Inflation rate increased by 0.2% and Consumer Price index(CPI) increased by 0.1% in December after the announcement from UK office for National Statistics which resulted in boosting British Sterling earlier. GBP/USD pair traded at 1.427, reaching a seven year low, with British Pound falling by 0.18% as compared to dollar.
US Dollar Index which is one of the instruments used to determine the strength of Greenbacks against six major currencies witnessed a rise by 0.22% at 99.38 which is highest level since January.
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