The Australian Dollar (AUD) is trading slightly lower against the US Dollar (USD) on Friday, with the AUD/USD pair at 0.6595. However, with the flash S&P Global Purchasing Managers Index (PMI) figures for September due on Monday at 23:00 GMT, caution could be the order of the day for traders. These upcoming releases will provide valuable insights into Australia’s economic dynamics at a crucial time, especially as the Reserve Bank of Australia (RBA) appears to have reached a turning point in its monetary policy.
### Strong PMIs in August: A Basis for AUD Support
The latest PMI figures released by S&P Global highlighted a significant acceleration in business activity in August. The Composite PMI climbed to 55.5, its highest level since April 2022, confirming a stable growth dynamic that has persisted for over 11 months.
At that time, the Manufacturing PMI reached 53.0, marking its strongest rise in three years. This figure indicates an improvement in order books, a modest return to external demand, and, above all, renewed confidence among manufacturers. As S&P Global noted, “manufacturing activity has returned to a pace of expansion not seen since September 2022,” helped in particular by new orders from the USA, Europe, and the Asia-Pacific region.
In the services sector, the picture was even more encouraging. The index jumped to 55.8, buoyed by the strongest rise in exports since June 2022 and an upturn in employment not seen since April. S&P Global pointed out that service companies benefited from robust demand and increased confidence, which prompted them to step up promotional efforts and broaden their customer base.
### What to Watch in September PMI Data
A continuation or improvement of these levels in the September PMI would reinforce the perception of a robust Australian economy, providing further support for the Australian Dollar against its peers.
Conversely, a bearish surprise—particularly in services or exports—could reignite concerns about the economy’s momentum and reopen debates about the RBA’s monetary policy direction.
Traders and investors will be closely monitoring Monday’s PMI releases before making their next moves in the AUD/USD market.
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