Aussie rises as China trade data delayed

 

Data after market close

Traders in Asia eagerly awaited the June trade data out of China, only to find the wait extended and extended. Latest rumours from the financial press suggest that they will released around 0700GMT later today. Pessimist might assume that the delay in releasing the data until after local markets have closed is a result of very poor numbers.

Recent surveys imply that export fell 2.0% y/y in June while imports crashed 4.5% y/y, resulting in a wider trade surplus of $44.7 billion from $41.7 billion in May.

AUD/USD has risen for three straight days and is edging toward the 100-day moving average at 0.7023. That moving average has capped prices on a closing basis since April 22. Support will likely be found at the 61.8% Fibonacci retracement of the June-July rally at 0.6915.

AUD/USD Daily Chart

Source: OANDA fxTrade

Singapore economy unexpectedly shrinks

The Singapore economy contracted 3.4% q/q in the second quarter, the largest contraction in about seven years, data released today showed. Economists had anticipated a milder slowdown to +0.1% from +3.8% in the last quarter of 2018. On an annualised basis, growth was a mere +0.1%, the slowest in a decade. The decline was mostly attributed to the manufacturing sector, which shrank 3.4% y/y as a result f the ongoing US-China trade frictions. Construction output was +2.2% y/y while services output grew 1.2%.

The Singapore dollar weakened mildly after the data, with USD/SGD rising to 1.3577 from 1.3571 at the open. The FX pair touched the lowest in eleven days yesterday amid broader US dollar weakness after Powell’s two days of testimony.

USD/SGD Daily Chart

Source: OANDA fxTrade

Slow calendar to close the week

Final Japan industrial production data for may is seen holding steady with a 2.3% m/m increase, the same as in April. Capacity utilisation is expected to rise just 0.2% after a 1.6% gain the previous month. Germany’s wholesale price index is seen rising 0.2% m/m and 1.3% y/y while the Euro-zone May industrial production probably rebounded to +0.2% m/m following a 0.5% decline in April.

There’s not much data for the US session, with June producer prices and a speech from Fed’s Evans scheduled.

The full MarketPulse data calendar can be viewed at https://www.marketpulse.com/economic-events/

Have a great weekend.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Andrew Robinson

Andrew Robinson

Senior Market Analyst at MarketPulse
A seasoned professional with more than 30 years’ experience in foreign exchange, interest rates and commodities, Andrew Robinson is a senior market analyst with OANDA, responsible for providing timely and relevant market commentary and live market analysis throughout the Asia-Pacific region. Having previously worked in Europe, since moving to Singapore he worked with several leading institutions including Bloomberg, Saxo Capital Markets and Informa Global Markets, proving FX strategies based on a combination of technical and fundamental analysis as well as market flow information. Andrew began his career as an FX dealer with NatWest and the Royal Bank of Scotland in the UK.