$ AUD, NZD Weakens as Higher Chinese Inflation Suggests Tightening.

The Takeaway: rising Chinese inflation could mean tightening > reduced demand for raw materials Australia New Zealand > AUD, NZD falls

Australian and New Zealand dollars weakening after the March consumer price index China showed higher than expected. With a more rapid price increase, people's Bank of China and the Government can tighten, if deflationary PPI and CPI target can avert large scale actions. Current inflation target China for 2012 is set to 4.0%.

GMT	China Price Indices	ACT	EXP	PREV
1:30	CPI (MAR)	3.6%	3.4%	3.2%
1:30	PPI (MAR)	-0.3%	-0.3%	0.0%

Despite the lower point in the so-called Aussie and Kiwi against the US dollar, reaction of the market to the Chinese data is relatively discrete. The two currencies have been selling as markets react to the situation Friday as the planned national focal points. Even with the higher consumer price, the people's Bank of China could adjust its update to cool the domestic economy. With the divergence between the PPI and CPI, the Bank could see that inflation, pressures are caused by domestic products, including agriculture. This could lead to adjustments in the economic policies of China more focused on the economy rather than hurt the export sector. 

Figure 5 minute AUDUSD. Line indicates the time of broadcast data. Graph generated with FXCM strategy Trader.

Figure 5 minute NZDUSD. Line indicates the time of broadcast data. Graph generated with FXCM strategy Trader.

Week-end : Dollar s'affaiblit après faible PFN ; La Chine, nous CPI in Focus

Evolution of weekend
March to U.S. non-farm payroll adds 120 k jobs, whereas k 205 Chinese CPI will be reported later today, IPC US on Iran Friday to respond to the major powers for nuclear talks on 14 April, well that the markets foreign exchange have reacted to Friday, lower than data for March NFP, the proximity to Friday stock market could cause reactions more cross-market for today's meeting. Statement of the President of the Federal Reserve Ben Bernanke two weeks ago, citing the labour market still-weak as one of the main reasons that the Central Bank will keep leads a loose monetary policy of many investors are now considering lower data as may open the door to another series of purchases of assets. Even if some members of the FOMC stated there are no more large scale purchases unless the economy weakens considerably, the Federal Reserve can be more pressed to keep appeasement to avoid walking on the recovery.
Reactions of markets and of the comments of the Central Bank may be strained until the end of the week as we March CPI will be reported Friday. Headline CPI is expected to slow to 2.6% 2.9% in the recent weakening in the price of energy, while the core CPI should remain at 2.2%. University of preliminary of the confidence of consumers in Michigan for April will be also published Friday, is expected to improve to 76.6 of 76.2.
The Asian market is expected to be volatile throughout the week, with the CPI Chinese and PPI on tap later today, rate decision Japan on 10 April, Australian March of the work Bank data on 12 April and first quarter Chinese GDP to highlight the Asian record of Friday.
At the time of writing, the yen is at the head of the European currencies against the dollar post-NFP. The New Zealand and Australian dollars are moderately lower that markets expect the Chinese data.