With China, watch the imports

The Australian dollar is locked in a tight range awaiting the release of November Chinese trade data.

I suspect AUD buyers are waiting in the weeds after the upbeat Chinese industrial production data but are apprehensive at challenging offers in the 1.0500 area until after all the cards are on the table.

The kneejerk market reaction on Chinese trade data is usually on export growth. The consensus is for a 9.0% rise, which is a slowdown from the 11.6% pace in Oct.

But it’s the import numbers that tell a better story about global growth. Chinese importers are the front line in the global manufacturing cycle — bringing raw materials into the country. The import numbers speak to their new order books and willingness to accumulate inventories. Expectations are for a 2.0% rise.

As for the overall trade balance? It doesn’t move the market.

No time is specified for the release.

Author: Adam Button

Adam Button is the managing editor of ForexLive™. He was previously the chief currency strategist at XForex and has also worked with Intermarket Strategy. Adam believes there's an edge in knowing every tidbit of news. He was formerly the head of the markets team at the Canadian Economic Press and is a graduate of Ryerson University. Adam lives in Montreal, follow him on Twitter: @FX_Button.

5 Comments

  1. Listen-up traders/ You have 2 of the most brilliant minds in F/X for free.
    Take heed, and throw your egos out the door. Adam and Eamonn are impecccably proficient in everything F/X ;)

  2. Adam, This is about the EUR. What impact might Mario Monte’s resignation have on the currency?

  3. Hi Vida. Monti leaving is no surprise, he always said that he would only be working temporarily. At some point there was speculation that he would stay but he shot it down quickly. The news is that Berlusconi is coming back and I don’t think the market wants anything to do with him. He’s disruptive with the neighbors and unpredictable.

  4. Hi Adam what the play b for aussie are u still looking to buy a dip to 1 0410.thanks

  5. I’m not sure AUD/USD is going to get all the way down there again on this run. I like AUD quite a bit and there is a trendline that comes in at 1.0450. I think that will be tested and I want to see how AUD reacts.

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