Australian Dollar Firmer on China Growth Surprise

 
   By James Glynn 
 

        SYDNEY--The Australian dollar climbed Wednesday on news of solid economic growth in China.
        China's economic growth held steady at 7% in the second quarter of the year, according to government data. The number surprised many analysts who had forecast a growth rate of 6.8%, amid a broad array of indicators pointing to increasing sluggishness in the world's second-largest economy.
        China is Australia's biggest trading partner, buying vast amounts of iron ore to feed its steel mills, making the Aussie dollar sensitive to its data.
        At 0640 GMT, the Australian dollar was trading at US$0.7475, compared with US$0.7428 late Tuesday.
        A focus was also kept on Greece, as the country approaches a crucial parliamentary vote on its bailout terms.
        Although eurozone leaders have said current agreements for Greece would prevent its exit from the eurozone, major hurdles remain to be cleared in Athens to win the emergency financing.
        Greece's parliament has to approve divisive economic overhauls on pension spending and tax increases--measures voters already rejected in a recent referendum.
        Meanwhile, the International Monetary Fund questioned the ability of Greece to deliver on promised bailout overhauls and warned in its starkest language yet that the eurozone must commit to debt restructuring to ensure the program will work.
        The IMF said one option was "a very dramatic extension" of Greece's debt. It proposed cutting rates and delaying the grace periods of the entire stock of European debt, including new assistance, by 30 years.
        Earlier, a Westpac survey showed a sharp 3.2% fall in consumer confidence in July from June, the weakest conditions since December 2014.
        Bill Evans, chief economist at Westpac said despite the drop in confidence, the Reserve Bank of Australia would be unlikely to cut interest rates at its next policy meeting in early August. It will instead await more data on the economic growth outlook.
        Write to James Glynn at james.glynn@wsj.com
        (END) Dow Jones Newswires

        July 15, 2015 03:38 ET (07:38 GMT)

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