Forex News: Australian Dollar Rises As Traders Focus On US-China

Australian Dollar Rises As Traders Focus On US-China Trade Talks

(RTTNews) - The Australian dollar strengthened against other major currencies in the Asian session on Monday, as traders will be closely watching the US-China trade discussions because they will impact the next move in the Australian Dollar (AUD).

Data from the customs office showed that China's exports increased in May, while imports declined from the last year due to weak domestic demand. Exports grew 4.8 percent on a yearly basis in May. This followed an 8.1 percent increase in April and also came in weaker than economists' forecast of 5.0 percent.

Meanwhile, imports declined by more-than-expected 3.4 percent from the previous year. Imports were forecast to drop 0.9 percent.

As a result, the trade surplus rose to $103.2 billion in May, which was above the expected level of $101.1 billion.

Data from the National Bureau of Statistics showed that China's overall inflation was down 0.1 percent on year in May. That beat forecasts for a decline of 0.2 percent but was unchanged from the April reading.

On a seasonally adjusted monthly basis, consumer prices fell 0.2 percent - in line with expectations and down from 0.1 percent in the previous month.

The bureau also said that producer prices stumbled 3.3 percent on year versus forecasts for a drop of 3.1 percent after falling 2.7 percent a month earlier.

Meanwhile, the market analysts predict that the RBA will slash interest rates again at its July policy meeting.

In the Asian trading today, the Australian dollar rose to nearly a 4-week high of 94.24 against the yen, from Friday's closing value of 94.06. The aussie may test resistance around the 96.00 region.

Against the U.S. dollar, the euro and the Canadian dollar, the aussie advanced to 4-day highs of 0.6519, 1.7520 and 0.8917 from last week's closing quotes of 0.6493, 1.7551 and 0.8890, respectively. If the aussie extends its uptrend, it is likely to find resistance around 0.66 against the greenback, 1.73 against the euro and 0.90 against the loonie.

The aussie edged up to 1.0803 against the NZ dollar, from Friday's closing value of 1.0795. On the upside, 1.08 is seen as the next resistance level for the aussie.

Looking ahead, U.S. Consumer Board's employment trends index for May, U.S. wholesale inventories for April and U.S. consumer inflation expectations for May are slated for release in the New York session.

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