Chinese rate cut failed to boost Aussie and Copper

Over the weekend Peoples Bank of China (PBOC) provided 25 basis points cut in its lending rate in a bid to boost World's second largest economy. Lending rate now stand at 5.1%.

• China faces lower growth prospect in 2015, worst in at least 5 years. GDP growth has slowed down to 7% in first quarter of 2015 and underlying data points at further weakness.
  
  
• Chinese inflation statistics has also been released over the weekend. CPI for April dropped -0.2% m/m and grew only 1.5% on yearly basis. Producer price index dropped by -4.6% in April, on yearly basis.
  
  
• PBOC have been providing policy easing since late last year, however such moves have so far failed to yield any significant improvement, reversing the course of ailing economy. Naturally market participants and economists are expecting further easing through reserve requirement, lending rates.

Aussie and Copper both failed gain over the rate hike as concern over Chinese economy overwhelmed the rate cut.

• Aussie bulls stand vulnerable as they failed once more to break above key resistance around 0.80. Aussie might move lower to test range floor if dollar provided strong performance this week. Aussie is currently trading at 0.789 against dollar.

• Copper is also struggling to break free of $2.95 resistance, moved down further, currently trading at 2.90/pound.