THE dollar was the best-performing currency in Asia yesterday, investors flocking to support the unit on news that China's economic slowdown in the second quarter was not as bad as some had feared.
China's gross domestic product grew by 7.5 per cent on year, easing from the 7.7 per cent growth it achieved in the first quarter but in line with a median forecast of 18 economists surveyed by Dow Jones.
China is Australia's biggest trading partner, buying huge amounts of iron ore and coal to support its infrastructure programs. As a result, the dollar trades as a strong proxy to China's economic health.
Markets were wary ahead of the China growth report, fearing that if the forecasts were wrong they would show the Asian giant slowing at an even faster pace, traders said.
At the close of local trading, the dollar was at US90.87c, up from US90.55c at the start of the session. Late on Friday, it was trading at US91.75c. It briefly traded below US90c on Friday, its lowest level in four years, on China concerns.
