Widening Trade Surplus Does Not Prevent Aussie’s Drop

Australia’s trade balance increased more than was expected, but that did not prevent the Australian dollar from falling. The likely reason for the currency’s drop was the risk-negative sentiment on the Forex market.

The Australian Bureau of Statistics reported that the trade surplus widened to A$1.87 billion in June (seasonally adjusted) from the negatively revised A$0.73 billion in May. Experts were anticipating a much smaller increase to just A$0.91 billion. Yet the Aussie did not respond to the positive report, dragged down by risk aversion caused by heating tensions between the United States and China.

AUD/USD dropped from 0.7403 to 0.7364 as of 12:26 GMT today. EUR/AUD gained from 1.5744 to 1.5774.

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