The Aussie dollar fell against other major currencies on Tuesday after China’s exports and imports were mixed.
In China the trade balance for September came in at a surplus of RMB376.2 billion, compared to RMB368 billion in August. Dollar figures were not immediately available. Imports plunged 17.7%, well below the expected drop of 15%, but exports eased 1.1%,better than the 6.3% decline seen.
The Australian and New Zealand dollars retreated from multi-week highs after weak Chinese trade data brought fears over slowing global growth back into focus.
Also on Tuesday, Reserve Bank of Australia Deputy Governor Philip Lowe welcomed a weaker Aussie, speaking to the CFA Institute Australia Investment Conference at Sydney.
He repeated the RBA’s recent messages that the fall in the Australian dollar is helping the economy re-balance away from mining investment.
Flexibility in the exchange rate is important, Lowe said.
“Depreciation over the past couple of years is playing an important role in helping the economy adjust to the wind down of the boom in mining investment,” he said.
Also on Tuesday night, RBNZ Gov Wheeler gave a dovish speech which also saw the New Zealand dollar weakened.
Intra-day bias remains bearish as 21 and 55 EMA are crossed to the downside on the 1 hour time-frame. Also SSRC oscillator is still showing signs of more sell off is expected in the pair. Am expecting further decline to 0.7188 support in the medium term as the market seems to be over-sold temporarily.
Tomorrow investors would be monitoring closely the USD Core Retail Sales m/m and Retail Sales m/m.