No major catalysts from Australia to drive the Aussie this week, which means Aussie price action was mostly driven by risk sentiment. This week, traders focused on the U.S.-China trade story to guide the Aussie up and down.
Australian Headlines and Economic data
- China December trade beats forecasts: exports up 7.6%, imports up 16.3% – This was likely a contributor to the Aussie’s early week strength, along with the broad positive risk sentiment vibes from the impending U.S.-China Phase 1 trade deal.
- U.S. Treasury drops China currency manipulator label ahead of trade deal signing
- China to buy more U.S. energy, manufactured goods in trade deal
- There was a broad fall in the Aussie against the majors during the U.S. trading session, likely due to a strengthening U.S. dollar after positive U.S. economic reports (e.g., US retail sales climb in December, Philly Fed Index Jumps Much More Than Expected In January)
- Chinese economy expanded by 6.0% q/y in Q4 2019 as expected
- Chinese industrial production jumped from 6.2% to 6.9% y/y vs. 5.9% consensus
- Chinese retail sales steady at 8.0% y/y vs. projected dip to 7.9%
- China’s Liu says Phase 1 trade deal bolsters future Sino-U.S. relations
- U.S.-China trade deal to ease global uncertainty: IMF chief