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The dollar extended gains made last night after positive US manufacturing data, while the Australian dollar took a hit when gross domestic product data on Wednesday confirmed that the country was experiencing a recession for the first time in three decades. Manufacturing activity in the US increased more than expected in August, with the increase in new orders.
The dollar, which was on a path of losing losses, rose against a basket of currencies, stabilizing overnight and then expanding its gains in early trading in London. By 0712 GMT, it was up 0.3% at 92.511.
The news also pushed Asian stocks higher overnight as European indices opened higher.
On the other hand, the Australian dollar fell after the gross domestic product data, which came worse than expected, confirmed that the country’s economy contracted by 7% during the three months to June, making the country in its first recession in nearly three decades.
