- AUD/USD picks up bids to refresh weekly top.
- China Yuan-denominated exports grew 31.7% in H1 2021, Trade Balance jump in June, Aussie NAB data disappoints for June.
- Markets stay sluggish as covid woes battle optimism ahead of US CPI, Aussie fiscal stimulus.
AUD/USD refreshes intraday high to 0.7500, up 0.32% intraday, as China reports strong trade numbers during early Tuesday. In doing so, the risk barometer pair ignores the covid woes at home, as well as cautious sentiment ahead of the US inflation data for June.
China reported a 31.7% rise in Exports, Yuan terms, during the first half of 2021 (H1 2021). Further, “Imports grew 43.9%, customs spokesperson Li Kuiwen said at a news conference in Beijing on Tuesday,” said Reuters. Monthly, June’s Trade Balance grew to $51.5B versus the $44.2B forecast and $45.53B prior.
Read: China’s June Trade Balance: Surplus widens as exports surge but imports growth ease
Earlier in the day, National Australia Bank’s Business Confidence and Business Conditions slipped below 23 and 33 respective priors to 11 and 24 in that order.
Other than the downbeat data, worsening coronavirus (COVID-19) conditions in Australia also probed AUD/USD bulls earlier in Asia. The Pacific nation registered 10-month high infections the previous day and pushed back plans of unlock in the key areas like New South Wales and Queensland.
Given the pandemic-led lockdown, Aussie PM Scott Morrison is up for announcing another local relief package to the businesses. The details of which will be out by late Tuesday.
In the case of the US, a senior health official turned down the need for the American to take Pfizer booster shots if they’re fully vaccinated. Though, the risk of the Delta variant couldn’t be ignored.
Even so, S&P 500 Futures remain subdued around the record top whereas US 10-year Treasury yields stay positive for the third consecutive day by the press time.
Looking forward, AUD/USD traders should keep their eyes on the risk catalysts for intermediate moves ahead of the US Consumer Price Index (CPI) data for June. Although expectations back mixed outcome, any firming of the price pressure will renew reflation fears and renew US dollar strength.
Read: US Consumer Price Index June Preview: Has inflation peaked?
Technical analysis
Despite piercing a 12-day-old resistance line around 0.7500, AUD/USD remains on the bears’ radar until staying below the 200-DMA level of 0.7585.