The NZD continued to pare back recent losses following the RBNZ recent surprise rate cut on Wednesday after stronger than expect trade data from China.
China Trade Balance – Exports Up
China’s trade surplus surged to USD45.05 billion in July from USD24.79 billion the year prior and beating market forecasts of USD40 billion. Exports were much stronger than expectations, rising 3.3% from a year earlier and defying market forecasts of a 2% drop. The rise in exports were largely driven from non-US countries, with exports to the US declining 6.5% and a further fall expected when the US impose more tariffs on USD300 billion of Chinese goods from 1st September.
US Jobless Claims Fall
The number of Americans filling for unemployment benefits unexpectedly fell last week to 209,000 from the previous weeks revised 217,000 and against the expectation of 215,000. Market sentiment was buoyed as the labour market remains strong despite a slowing economy.
RBA Monetary Policy Statement in Focus
Focus will turn to the Reserve Bank of Australia monetary policy statement this afternoon at 1.30pm. The RBA left rates unchanged at 1% when they met on Tuesday, however left the door open for further easing. RBA Governor Lowe will also appear before the House of Representatives’ Standing Committee on Economics at 11.30am.
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