Investing.com - The Australian dollar gained Thursday after preliminary private survey data showed top trading partner China's manufacturing rebound reached solid expansion territory.
HSBC's China flash manufacturing PMI for July rose to 52.0, a jump from the June reading of 50.7 that indicated that the economy is finally turning around.
"The HSBC China Manufacturing PMI rose further to 52.0 in the flash reading for July. Both new orders and new export orders expanded at a faster pace than in June," said HSBC chief China economist Qu Hongbin.
"The employment and prices sub-indices also improved. Meanwhile, stocks of finished goods contracted at a slower pace. Economic activity continues to improve in July, suggesting that the cumulative impact of mini-stimulus measures introduced earlier is still filtering through. We expect policy makers to maintain their accommodative stance over the next few months to consolidate the recovery."
AUD/USD traded at 0.9469, up 0.13%, after the data.
Earlier, Japan's June trade deficit came in at ¥822.2 billion, wider than the expected ¥643 billion, and the 24th straight monthly shortfall.
USD/JPY traded at 101.57, up 0.08%, after the data and ahead of a 1245 local time (0545 GMT) speech by Bank of Japan Governor Haruhiko Kuroda at a policy forum in Bangkok hosted by the Bank of Thailand. His Q&A session is scheduled to start after that.
The New Zealand dollar fell Thursday after the central bank signalled a pause in a tightening cycle.
The Reserve Bank of New Zealand hiked the Official Cash Rate for the fourth time in a row as widely expected and signaled a period of pause as it assesses the impact.
Governor Graeme Wheeler raised the OCR by 25 basis points to 3.5% and said the economy "appears to be adjusting to the monetary policy tightening that has taken place since the start of the year."
"It is prudent that there now be a period of assessment before interest rates adjust further towards a more-neutral level."
NZD/USD traded at 0.8621, down 0.60%, after the decision.
New Zealand also reported a trade balance for June with a surplus of NZ$247 million, above the NZ$150 million expected month-on-month.
Overnight, the dollar traded largely higher against most major currencies, buoyed by Tuesday's inflation and home sale data as well as upbeat earnings, though geopolitical tensions in Ukraine weighed on the greenback's advance.
The Labor Department reported Tuesday that the U.S. consumer price index rose 2.1% in June, unchanged from the previous month and in line with forecasts.
On a month-over-month basis, U.S. consumer prices were up 0.3% after a 0.4% increase in May, also in line with expectations.
Separately, reports that two Ukrainian jet fighters were shot down over the rebel-held city of Donetsk only days after pro-Russian separatists allegedly shot down a Malaysian Airlines flight with a missile rattled nerves, which took its toll on the dollar, the euro and other currencies.
The US Dollar Index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.03% at 80.91.
On Thursday, the U.S. is to produce data on unemployment claims, manufacturing activity and new home sales.