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China’s trade data earlier helps the aussie on two fronts

“While the positive impact on the import figures can be seen clearly from a trade perspective – since Australia is one of China’s main exporters – there is also a sort of indirect impact that has helped to boost the aussie” reports The fact that China’s imports remain solid and growing at a pace better than previous years (2015 and 2016), highlights how much China still relies on consumption and purchases.And that means Chinese authorities should not really want to favour a weaker Chinese yuan as it would create a burden at the consumer level – weaker currency meaning more expensive imports. The aussie does tend to react to any sort of “revaluation” in the yuan as seen here , so the fact that imports are still growing at current levels mean that there is a lower likelihood of Xi Jinping opting to devalue the yuan as a tool against the US in trade.

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