The Australian dollar rose today even though the trade balance report in China, Australia’s trading partner, did not look good at first glance. But in fact, the data painted a picture of a strong economy of the Asian nation, which is a good sign for the Australian economy.
China’s trade balance surplus fell sharply to $28.47 billion in September from $40.94 billion a year ago. The reading was below the consensus forecast of $39.5 billion and the lowest since March. While it may look bad, the decrease of the surplus was a result of a sharp increase of imports, suggesting that China’s economy is actually rather solid. Moreover, that means Australia can sell more of its goods and raw materials to its major trading partner.
AUD/USD rose from 0.7818 to 0.7844 as of 11:16 GMT today. AUD/JPY advanced from 87.76 to 87.99. Both currency pair gained for the fourth consecutive session.
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