China trade balance preview – what to expect in AUD/USD?

By FXStreet FXStreet (Guatemala) – AUD/USD made recovery attempts in a better risk environment, but the 100 SMA at 0.7008 on the hourly sticks capps in the main. Risk has started to filter through again after the PBoC intervening in the offshore market yesterday, and all eyes remain on China again today with the extra twist of the trade balance for December’s business released in the session.

AUD/USD temporary lift on PBoC intervention

The yuan climbed as much as 0.7 percent versus the dollar in Hong Kong, and this briefly erased its discount to the onshore rate for the first time since October. The cost to borrow yuan overnight in the city’s interbank market rallied to 66.82 percent. That was more than five times the previous high on Monday while the PBOC’s purchases reduced supply of the currency. The Central Bank is intervening in the Hong Kong market to try and curb bets on a heavy depreciation of the yuan and close the gap between onshore and offshore rates as a requirement for IMF members.

China’s Trade balance outlook

With all eyes on China this year so far, the trade balance is even more of a potential driver for this session. Among the stock …read more

Source:: FX Street