China's Caixin Manufacturing PMI for December dropped to 49.0 vs. 48.8 expected and 49.4 previous, showing that the country’s covid containment continued to negatively impact the output at the end of 2022.

While output fell at a softer rate compared to November, total new orders fell at a quicker pace.

Wang Zhe, Senior Economist at Caixin Insight Group said, “Both manufacturing supply and demand continued to shrink last month. Fallout from the pandemic was a drag on production and sales, with the subindexes for output and total new orders staying below 50 for the fourth and fifth straight months, respectively.”

“Due to the economic downturn and weak demand overseas, the reading for new export orders also remained in contraction for the fifth straight month,” Wang added.

AUD/USD holds lower ground below 0.6800

The upbeat print of the Chinese Manufacturing PMI fails to lift the Aussie Dollar, as AUD/USD is testing lows near 0.6775, down 0.41% on the day, at the time of writing.