AUD/USD: Bulls undeterred by below-forecast Aussie trade surplus
|- AUD/USD keeps gains after dismal Aussie trade data.
- Australia's trade surplus narrowed to AUD 8,025 million in May.
- Australia's currency remains at the mercy of the broader market sentiment.
AUD/USD continues to trade in the green following the release of the weaker-than-expected Australian trade data for the month of May.
Australia's exports slipped by 4% in May, having declined by 11.3% in the preceding months. Meanwhile, imports suffered a 6% decline following April's 9.8% drop. Despite the bigger decline in imports, Australia's trade surplus narrowed to AUD 8,025 million from AUD 8,800 million. The surplus was forecasted to rise to AUD 9,000 million.
The decline in imports and exports was expected as economic activity in Australia and across the globe slowed sharply in April and May due to the coronavirus lockdown restrictions. Hence, the Aussie dollar is showing resilience in the face of weak numbers.
The AUD/USD pair is trading at session highs near 0.6925 at press time, having added five pips since the release of the Aussie trade data.
The bid tone around the Aussie dollar may weaken if the equity markets turn risk-averse in response to the rising number of coronavirus cases in the US. New reported infections in the U.S. topped 50,000 on Wednesday for the first time, according to Washington Post.
However, that looks unlikely with the Federal Reserve running an ultra-accommodative policy. It is worth noting that cases in the US have risen at a faster rate for the past week or so. Even so, equities have largely remain bid.
Besides, news from pharma companies like Pfizer and the biotech firm BioNTech suggesting positive trial results of a vaccine are likely to keep risk sentiment intact.
Technical levels
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