Dismal China data pushes AUD/USD to new 4.5-month low
|- AUD/USD prints fresh 4.5-month low in response to below-forecasts China factory and consumer spending data.
- China data indicates the economy again lost steam in April.
China macroeconomic data released soon before press time missed estimates, sending AUD/USD down to 0.6923, the lowest level since January 3.
The consumer spending, as represented by retail sales, rose 7.2% in April, missing the expected rise of 8.6%. Retail sales had risen by 8.7% in March.
Meanwhile, industrial production rose 5.4% in April, having registered 8.5% growth in March. The markets were expecting a print of 6.5%.
The below-forecast industrial production and retail sales number confirms the world’s second largest economy lost steam in April and pours cold water optimism generated by the rebound observed in March.
Add to that the re-escalation of US-China trade tensions and the path of least resistance for the AUD, a proxy for China and other risky assets appears to be on the downside.
The AUD/USD pair is currently trading at 0.6932 with the hourly chart reporting a potential bullish divergence of the relative strength index.
Technical Levels
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