- AUD/JPY extends losses from the highest in two weeks to revisit the sub-76.00 area.
- Australia’s Trade Balance drops to 2,643M in August versus 5,154M forecast.
- Market optimism pauses amid concerns over US President’s health even as he left Walter Reed after COVID-19 treatment.
AUD/JPY drops to the intraday low of 75.86, currently around 75.92, during the initial hour of Tokyo open on Tuesday. The pair recently reacted to a downbeat August month trade numbers for Australia while paying a little heed to the ANZ Job Advertisements for September.
Australia’s headline Trade Balance slipped from 4,294M in July to 2,643M in August. Details suggest that the Exports shrank more than -3.4% prior to -4.2% whereas Imports also weakened from 6.2% to 2.0%. On the contrary, the Australia and New Zealand Banking Group’s (ANZ) Job indicator for September rose past-1.6% previous readouts to +7.8%.
Other than the data, the pair also dropped as the latest video of US President Donald Trump pushed market players to doubt his breathing capacity despite leaving the hospital earlier in the day. The Republican leader said to feel “20 years younger” after the latest coronavirus (COVID-19) treatment.
Against this backdrop, Japan’s Nikkei 225 rises 0.20% whereas Australia’s ASX 200 drops over 0.30% by the time of the press. Further, the S&P 500 Futures marks 0.14% loss after probing the mid-September highs the previous day.
Moving on, market players are waiting for the monetary policy meeting of the Reserve Bank of Australia (RBA), up for conveying outcome at 03:30 GMT, followed by the Aussie budget release of 08:30 GMT.
While the RBA is expected to stand pat on its current monetary policy, the tone in the rate statement will be the key. Further, the Australian government is expected to announce tax cuts after unveiling details of infrastructure spending the previous day.
It’s worth mentioning that the risk catalysts, mainly relating to US President Trump’s health, will be the key to determine near-term market moves.
Technical analysis
Unless breaking a confluence including 50-day SMA, a five-week-old falling trend line and a 38.2% Fibonacci retracement level of June-August upside, near 76.20/25, AUD/JPY buyers are likely to remain troubled.
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