AUD/USD Bounce Continues Following Sturdy Chinese language Commerce Knowledge

AUD/USD, Chinese language Steadiness of Commerce, PBOC Speaking Factors:

• Chinese language commerce stability blows away expectations, coming in at $51.53 B vs. $44.2 B est.
• China continues to fret about potential slowdown, straightforward financial coverage returns
• AUD/USD appears to check 0.7500 regardless of COVID fears weighing on sentiment

Chinese language export information blew expectations out of the water Tuesday morning, regardless of current worries over a slowing home financial system. Exports for June rose 32.2% (in USD) over the identical interval final 12 months. The stability of commerce for June got here in at $51.53 billion, vs. a consensus estimate of $44.2 billion. For the primary half of 2021, China reported a commerce surplus with america of $164.92 billion. The commerce surplus with the US for the month of June got here in at $32.58 billion, up from $31.78 billion within the month of Could. Regardless of current value pressures and intervention from Beijing, China Customs mentioned in a press release that imported inflation dangers “stay manageable.”

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The robust commerce prints come when China is easing financial circumstances to stave off an financial slowdown. Simply final week, the Folks’s Financial institution of China (PBOC) introduced that it might reduce reserve requirement ratios by 0.5% for banks, with the coverage taking impact on July 15. China was the one main financial energy to publish optimistic GDP development in 2020 as coronavirus ravaged the world. However as nations across the globe put together to tighten coverage, the PBOC is now displaying a cautious strategy. You possibly can learn extra in regards to the state of the APAC area right here.

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AUD/USD has been beneath strain of late following renewed virus fears in Australia, together with Federal Reserve hawkishness. The Australian Greenback might doubtlessly have bottomed following a take a look at of September 2020’s swing excessive at 0.7413. Presently AUD/USD stays beneath the important thing 0.5% Fibonacci stage at 0.7499, having did not materially break above throughout the previous few classes. With virus fears in Australia rising, the Australian Greenback might proceed to consolidate close to its 2021 lows till the basic outlook in Australia improves.

— Written by Brendan Fagan, Intern for DailyFX

To contact Brendan, use the feedback part beneath or @BrendanFaganFX on Twitter