Back to back Economic Data misses have sent the Australian Dollar reeling. Retail sales came in .2% versus .3 % expected but with the trade balance coming in a -2.22 billion versus -1.7 billion expected , we’ve seen the reduction of weak long positions that were established this morning in anticipation of a neutral RBA forward guidance
On a positive note, the China June Caixin Services PMI came in at 52.7 vs. 51.2 prior, which is providing some counterbalance to the weak Australian domestic data and halting the Aussie dollar slide just above the .75 handleFinally, and perhaps more significantly, local traders are looking over their shoulder at today’s PBOC fix, the weakest setting since 2011 ,which sent the USD tentatively bid across the region. There’s certainly some speculation and fear that today’s aggressively weaker Yuan fix is a PBoC policy driven move given the CNH midpoint peg is out of line with the overnight drop in the USD index.
About Stephen Innes
Senior Currency Trader and Analyst, Stephen has over 25 years of experience in the financial markets and specializes in Asian currencies at OANDA . After having started his trading career with NatWest Bank, he is currently based in Singapore as a Senior Currency Trader and Analyst with OANDA, focusing on the movement of the Aussie Dollar and ASEAN Currencies. Stephen has an extensive trading experience in Interest Rate Futures, Money Markets and Precious Metals. Prior to joining OANDA, he worked with organizations like Cambridge Mercantile, Nat West, Garvin Guy Butler, Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario. Follow on Twitter profile.