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Forex - Aussie drops in Asia as NAB disappoints, China trade eyed

Published 11/07/2016, 08:27 PM
Updated 11/07/2016, 08:28 PM
© Reuters.  Aussie falls further
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Investing.com - The Aussie fell further in Asia on Tuesday as a closely-watched business survey disappointed with trade data out of China in focus as markets gear up for U.S. election results slated to arrive early in the start of the Asian trading day on Wednesday.

AUD/USD traded at 0.7703, down 0.32%, while USD/JPY changed hands at 104.47, flat.

In Australia, NAB business confidence for October came in at plus-4, compared with a previous reading of plus-6, and the NAB business survey came in with a reading of plus-6, compared with a previous reading of plus-8.

"Beyond the near-term, impetus from those growth drivers will fade, which will see the economy slow into 2018. Two more 25bps rate cuts are still expected from the RBA next year in response to ongoing low inflation and a more subdued growth outlook," NAB Chief Economist Alan Oster said, adding he is clearly more concerned than the Reserve Bank about the near-term outlook.

In China, the trade balance for October is expected to show a surplus of $51.7 billion with exports seen down 6.0% year-on-year and imports showing a 1.0% decline.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.06% to 97.84.

Overnight, the dollar pushed higher against the other majors currencies on Monday, as the growing opinion that Hillary Clinton could win the upcoming presidential election continued to boost demand for the greenback.

The dollar gained ground as hopes for a Clinton win mounted after the FBI informed Congress over the weekend that it had "not changed its conclusions" on the private email server maintained by the Democratic candidate.

The greenback also remained supported after the Labor Department said on Friday that the U.S. economy added 161,000 jobs in October from the prior month and that the unemployment rate ticked down to 4.9%.

The data supported expectations for a December rate hike by the Federal Reserve.

In the euro zone, data earlier showed that German factory orders fell 0.6% in September, confounding expectations for a 0.3% rise. Factory orders increased 0.9% in August, whose figure was revised from a previously estimated 1.0% climb.

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