Soros Punts AUD With China Data Looming
The Australian press is humming about a George Soros $1 billion – and perhaps $3 billion -- AUD short ahead of the RBA decision. He is said to have earned as much as $60 million on the trade.
The focus will stay on the Aussie when China releases April trade balance numbers at 0200 GMT. The import/export data often serves as a preview of upcoming industrial data. In particular, import numbers provide a look at early demand in the global manufacturing cycle. For April, imports are expected to rise 13% y/y while exports are forecast to rise 9.2%. The trade balance (exp $16.15B surplus) is less of a concern.
Expect a knee jerk reaction in the Australian dollar but it's rarely more than 30-40 pips on this release. A climb above 1.0230 would put AUD/USD back at pre-RBA levels. A disappointing result could renew the focus on the cycle low at 1.0115.The Chinese numbers come after a choppy day in Europe and the US. The euro jumped on upbeat German industrial numbers but gave back all the gains in US trading. So far the 1.3070 level has proven to be solid support and there is chatter about semi-official buying around 1.3050.
|Trade Balance (MAR)|
|307M||0M||-111M||May 07 1:30|
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