Antipodean Currencies Slide After China Trade Data

(RTTNews) - The Antipodean currencies such as the Australia and the New Zealand dollars weakened against other major currencies in the Asian session on Friday, following the release of China's trade data that showed a sharp slowdown in exports growth and an unexpected fall in imports during the January to February period.

Data showed that the China trade surplus increased to $170.5 billion in January to February. This was well above forecast of $143.1 billion.

China's exports growth eased more than expected at the start of the year and imports logged an unexpected sharp decline amid mounting trade tensions.

Exports grew at a slower pace of 2.3 percent annually in the January to February period, following a 10.7 percent rise in December, data from the customs office showed. Exports were expected to climb 5.0 percent.

Imports declined 8.4 percent from a year ago, in contrast to the 1.0 percent increase registered in December. Economists had expected imports to rise 1.0 percent again in January to February period.

China imposed additional tariffs of up to 15 percent on imports of agricultural and food products from the US. The new tariffs take effect on March 10.

The move came after the U.S. President Donald Trump raised tariffs on Chinese products to 20 percent across the board.

Asian markets remain cautious, as confusion reigns around U.S. President Donald Trump's policy agenda and the impact of his trade policies on inflation, interest rates and economic growth.

Trump said on Thursday that his administration would not consider stock market reaction when hammering out the details of its tariff policy.

Treasury Secretary Scott Bessent rejected the idea that tariff hikes will ignite a new wave of inflation and suggested that the Federal Reserve ought to view them as having a one-time impact.

Fed Chair Jerome Powell gives keynote speech at an event in New York hosted by University of Chicago Booth School of Business later in the day.

As Canada delays its second round of retaliatory tariffs on US goods until April 2, traders continue to monitor developments in global trade. This ruling comes after US President Donald Trump decided to exempt Canadian and Mexican goods from his planned 25% tariffs under the USMCA.

In the Asian trading today, the Australian dollar fell to more than a 1-month low of 1.1018 against the NZ dollar, more than a 7-month low of 1.7154 against the euro and a 3-day low of 92.97 against the yen, from yesterday's closing quotes of 1.1039, 1.7038 and 93.80, respectively. If the aussie extends its downtrend, it is likely to find support around 1.08 against the kiwi, 1.72 against the euro and 91.00 against the yen.

Against the U.S. and the Canadian dollars, the aussie dropped to 2-day lows of 0.6300 and 0.9015 from Thursday's closing quotes of 0.6332 and 0.9050, respectively. On the downside, 0.60 against the greenback and 0.88 against the loonie are seen as the next support levels for the aussie.

The NZ dollar fell to a 5-year low of 1.8924 against the euro, from yesterday's closing value of 1.8807. The kiwi may test support near the 1.90 region.

Against the yen and the U.S. dollar, the kiwi slipped to a 3-day low of 84.29 and a 2-day low of 0.5712 from Thursday's closing quotes of 84.98 and 0.5736, respectively. If the kiwi extends its downtrend, it is likely to find support around 83.00 against the yen and against the 0.55 against the greenback.

Looking ahead, Eurostat is slated to release revised euro area GDP data for the fourth quarter of 2024 at 5:00 am ET in the European session. The statistical office is expected to confirm 0.1 percent sequential growth.

In the New York session, U.S. and Canada unemployment data for February, U.S. Baker Hughes oil rig count data and U.S. consumer credit change for January are slated for release.