AUD/USD: No response to above-forecast Australian trade surplus
|- AUD is not impressed by an uptick in Australia's trade surplus.
- The RBA is expected to keep rates unchanged at 0.75%.
AUD/USD is struggling to extend Monday's 0.86% rally despite the upbeat Aussie data released at 00:30 GMT.
Australia's current account surplus ticked higher to A$7.9 billion, beating the expected rise to A$6.3 billion from the second quarter's A$5.9 billion, the official data showed. "For the first time in 46 years, we have had two consecutive current account surpluses," ABS Chief Economist Bruce Hockman said, according to Kyle Rodd, Market Analyst, Australia, IG.
The above-forecast current account surplus will likely put an upward pressure on the gross domestic product (GDP) figures scheduled for release on Wednesday. The data is expected to show the economy expanded at an annualised rate of 1.7% in the third quarter compared to 1.4% in the second quarter. The quarter-on-quarter growth rate is expected to remain unchanged at 0.5%.
AUD/USD, however, is not impressed by the rise in the current account surplus. The pair has barely moved in the last 25 minutes and is currently trading largely unchanged on the day at 0.6820.
The lackluster response could be associated with caution ahead of the Reserve Bank of Australia's (RBA) rate decision, scheduled at 03:30 GMT. The bank is widely expected to keep rates unchanged at 0.75% and deliver a rate cut in February.
Note that Australia's latest economic readings have been anything but positive. The manufacturing activity contracted in the month of November, job ads fell further, inflationary pressures eased and building approvals fell much more than expected, signaling a deeper deterioration in the economic activity, according to Kathy Lien, Managing Director BK Asset Management.
As a result, the RBA is unlikely to sound hawkish. The central bank is expected to keep rates unchanged at 0.75% and deliver a rate cut in February.
Technical levels
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