Forex News
- The Dow erased a strong early advance and reversed lower as the semiconductor rebound lost momentum.
- Cheaper Crude Oil and firm housing data gave equities an early lift that did not stick.
- Tomorrow's CPI release headlines a heavy inflation calendar, and traders are cutting risk into it.
The Dow Jones Industrial Average (DJIA) spent Tuesday proving that a one-day bounce is not the same as a bottom. Futures pushed higher through the overnight and premarket sessions, carried by a rebound in semiconductors and a softer Crude Oil tape, climbed into the early afternoon, then ran straight into a wall. From a session high near 51,250 the index unwound roughly 820 points to a low around 50,450 before steadying close to 50,500, leaving the day's rally as little more than a round trip. For an index that owns almost none of the chip names doing the heavy lifting elsewhere, that is the familiar trap: when the broad tape turns, the Dow gets dragged along whether its components deserve it or not.
A chip rebound with a short shelf life
Monday's rebound in the major semiconductor exchange-traded fund (ETF) had the look of a dead-cat bounce, and Tuesday confirmed it. The fund gave back close to 4% after Monday's near 6% pop, itself a reflex off the worst session for chips in years last Friday. The market wants to treat that washout as capitulation and the bounce as a bottom, but the buyers keep failing to follow through. The deeper issue is rates: Friday's much stronger than expected Nonfarm Payrolls (NFP) report jolted Treasury yields higher and nudged the odds of further Federal Reserve (Fed) tightening up, and an artificial intelligence trade built on cheap money and heavy borrowing does not enjoy that backdrop. The Dow is not a chip index, but it cannot escape the gravity when the leaders roll over.
Cheaper Crude Oil, no buyers for the story
The early bid had a second leg that should have lasted longer than it did. West Texas Intermediate (WTI) Crude Oil fell about 4% to trade under $90 a barrel after US officials flagged a meaningful pickup in Strait of Hormuz shipping traffic, and President Trump floated the prospect of a US-Iran deal within a few days that would reopen the strait immediately. Lower energy costs are usually a tailwind for the broad market, and the session even had a genuinely strong data point to lean on, with existing home sales jumping 3.2% on the month and topping forecasts. None of it held the bid. Energy shares sagged alongside the Crude Oil price, and the rest of the tape decided it had bigger things to worry about than cheaper gasoline.
The bubble-top whispers get louder
What it is worried about is whether the whole artificial intelligence engine is running hot. OpenAI confidentially filed for an initial public offering (IPO) late Monday, and SpaceX is lined up for the largest IPO ever this Friday at a valuation north of $1.75 trillion. Bulls read that as more fuel for the trade; a growing camp reads it as the kind of supply that shows up near a top. With valuations stretched and the chip complex wobbling, the second interpretation had the upper hand on Tuesday afternoon.
CPI is the print nobody wants to front-run
The bigger reason the rally got sold is sitting on tomorrow's calendar. The May Consumer Price Index (CPI) is the week's marquee red-band release, and the consensus does the market no favors. Headline CPI is seen accelerating to 4.2% YoY from 3.8%, with the monthly pace at 0.5% and core holding firm near 2.9% YoY. After a hot jobs report and with rate-hike odds creeping higher, a print that confirms re-acceleration is exactly the wrong news for equities, the classic case where firmer data reads as a threat rather than a comfort. Producer Price Index (PPI) figures follow Thursday and the preliminary University of Michigan sentiment survey closes the week Friday, but CPI sets the tone. With that overhead, trimming risk into the close is less about conviction and more about not wanting to hold the bag if the number runs hot.
Trading framework
Upside: a reclaim of 51,000 puts the session high near 51,250 back in play, and only a push through the 51,400 area reopens the record-chase narrative.
Downside: losing the 50,450 low exposes the 50,000 handle, with the daily 50-period Exponential Moving Average (EMA) near 49,650 as the next meaningful shelf.
Bias: neutral to bearish into CPI. The failed breakout and the daily Stochastic Relative Strength Index (Stoch RSI) rolling over from elevated territory argue for caution, and a hot inflation print would likely do the rest. A soft surprise is the bulls' escape hatch, but that is a coin flip nobody on the desk wants to call the night before.
Dow Jones 5-minute chart
Futures FAQs
The futures market is an exchange-based auction in which participants buy and sell contracts of an underlying asset at a predetermined future date and price. The set price is agreed upon today and is derived from the underlying asset. Futures contracts can be based on a wide range of assets, with commodities among the most popular, although currencies and indices are other common underlying assets. Futures prices depend on their underlying asset and act as a mechanism for firms, institutions, and large-position traders to manage risks through hedging.
Futures can be traded in different ways. The most common ways are via a regulated exchange or via Contracts For Difference (CFDs). In the former, liquidity is high and pricing is more transparent, with the broker serving only as an intermediary between you and the market. Still, it generally requires more capital. The largest futures exchanges are the Chicago Mercantile Exchange (CME) and the New York Mercantile Exchange (NYME). As for CFDs, these require less capital and thus trading is more flexible, but at the cost of less transparency.
The E-mini S&P 500 index, Crude Oil (Brent, WTI), Natural Gas, Gold, Silver, Copper, and soft commodities such as grains are among the most actively traded contracts. These offer strong liquidity and are closely followed by traders worldwide. Futures market volume consistently exceeds spot market volume, often significantly. This dominance is driven by leverage, hedging, and higher liquidity on exchanges.
Yes. Future gauges, particularly equity index futures such as those of the S&P 500 or the Nasdaq, are widely considered key gauges of market sentiment because they reflect investors’ expectations for the next session’s opening price. When equity futures drop, it is a sign of risk-aversion, signaling bearish market sentiment. On the contrary, rising equity futures suggest markets are risk on.
As a futures contract approaches its maturity date, the futures price converges upon the spot price, becoming almost identical at expiration. However, prices can diverge significantly before the contract ends. A market is in contango when future prices are higher than spot prices, while the mirror image is called backwardation (when current prices are higher than future prices). For commodities, the normal state of the market is contango because holding the asset over time incurs costs such as storage or insurance fees. When markets turn from contango to backwardation – or vice versa – it signals a shift in the trend: a change from contango to backwardation is taken as a bullish sign, while going from backwardation to contango is generally considered bearish.
- Australia’s Westpac Consumer Sentiment Index fell to -2.9% in June from 3.5% previously.
- China’s May trade data exceeded expectations, with Exports rising 19.4% YoY and Imports increasing 27.4% YoY.
- Despite the upbeat Chinese figures, concerns over weaker non-tech exports and fragile domestic consumption in China limited support for the AUD.
The AUD/USD pair falls to near 0.7040 on Tuesday, as the Australian Dollar (AUD) failed to gain support from stronger-than-expected Chinese trade data released earlier in the Asian session.
The pair trimmed gains following the release of Australia's Westpac-Melbourne Institute Consumer Sentiment Index, which fell to -2.9% in June from the previous 3.5.
China’s May Exports surged 19.4% YoY, beating expectations, while Imports jumped 27.4%, signaling stronger external and domestic demand. The figures initially supported sentiment around China-linked currencies such as the Aussie, as China remains Australia’s largest trading partner.
The improvement was led by strong demand for high-tech goods, semiconductors, and AI-related products, helping China’s trade surplus rise to $105.43 billion in May.
However, concerns remain over weaker momentum in non-tech exports and China’s still-fragile domestic consumption outlook.
Short-term technical analysis:
On the 4-hour chart, AUD/USD trades at 0.7042, maintaining a bearish near-term bias as it remains below both the 20- and 100-period Simple Moving Averages (SMAs) at 0.7080 and 0.7136, respectively. The Relative Strength Index (RSI) hovers in the mid-30s, hinting at lingering downside pressure, although it is attempting to stabilize after recent oversold-like readings.
On the topside, immediate resistance emerges at 0.7047, with a stronger cap at 0.7063, ahead of the clustered 20-period SMA near 0.7080 and the higher 100-period SMA around 0.7136. On the downside, initial support sits just below at 0.7041, with a more significant floor at 0.7033; a clear break beneath this band would open the way for further losses in line with the prevailing bearish structure.
(The technical analysis of this story was written with the help of an AI tool.)
- EUR/USD rises as hopes for a Middle East peace deal weigh on the US Dollar.
- Traders await Wednesday's US inflation report for fresh clues on the Fed's monetary policy path.
- ECB is expected to raise interest rates on Thursday, but traders want clues on what comes next.
EUR/USD trades on the front foot on Tuesday as tentative signs of de-escalation in the Middle East conflict weigh on safe-haven demand for the US Dollar (USD). Lower Oil prices are also supporting the Euro (EUR), given the Eurozone's heavy reliance on imported energy.
At the time of writing, the pair is trading around 1.1553, recovering from a two-month low of 1.1499 touched on Monday.
US President Donald Trump indicated that the United States and Iran are nearing an agreement to end the war in the Middle East, while Iran and Israel have agreed to halt hostilities. "We're in the final throes of what will be a very, very good deal," Trump told reporters on Tuesday. He added that the Strait of Hormuz would reopen as soon as a deal is finalized.
However, tensions in the Gulf region remain elevated. Israel has continued military operations in Southern Lebanon, while Iran has warned that fighting could resume if Israeli attacks continue. As a result, dips in the US Dollar remain shallow.
The US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, is trading around 99.89, down 0.12% on the day.
Meanwhile, the Greenback continues to draw support from hawkish Federal Reserve expectations. Traders expect the US central bank could raise interest rates as soon as September, with the probability of a 25-basis-point rate hike standing at around 35%, according to the CME FedWatch Tool.
Attention now turns to the US Consumer Price Index (CPI) report due on Wednesday. Economists expect annual inflation to accelerate to 4.2% in May from 3.8% in April.
The report could provide a fresh signal ahead of next week's Fed meeting, where policymakers are widely expected to leave rates unchanged as inflation continues to drift further away from the central bank's 2% target.
Across the Atlantic, traders are fully pricing in a rate hike at the European Central Bank (ECB) meeting scheduled for Thursday. The bigger question is whether the ECB will leave the door open to further rate increases amid rising stagflation risks across the Eurozone.
ECB FAQs
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region. The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets – usually government or corporate bonds – from banks and other financial institutions. QE usually results in a weaker Euro. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic.
Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.
- USD/CAD trades around 1.3950 on Tuesday, virtually unchanged on the day after reaching a two-month high of 1.3961 on Monday.
- Investors remain cautious despite the de-escalation between Iran and Israel, as geopolitical tensions in the Middle East continue to support risk aversion.
- The Bank of Canada is widely expected to keep its policy rate unchanged at 2.25% on Wednesday amid mixed signals from the Canadian economy.
USD/CAD trades around 1.3950 on Tuesday at the time of writing after snapping a four-day winning streak. The pair is pulling back slightly after reaching a two-month high of 1.3961 on Monday, as the US Dollar (USD) gives back part of its recent gains and investors adjust positions ahead of the Bank of Canada (BoC) monetary policy decision.
Market sentiment improved after Iran and Israel agreed to halt mutual attacks following an appeal from US President Donald Trump. The de-escalation reduced safe-haven demand and limited support for the Greenback. However, caution remains elevated. According to several media reports, the Israeli military ordered the immediate evacuation of parts of the Lebanese city of Tyre ahead of potential strikes, while Israeli Prime Minister Benjamin Netanyahu stated that the conflict with Iran and Hezbollah “has not yet ended.”
On the US side, markets continue to assess the outlook for Federal Reserve (Fed) policy. Strong US labor market data released recently have reignited inflation concerns and boosted expectations of additional monetary tightening. According to the CME FedWatch tool, the chance of a 25-basis-point rate hike in December has risen to 43%, up from just 14% a month ago. Upcoming Consumer Price Index (CPI) data on Wednesday and Producer Price Index (PPI) figures on Thursday are expected to provide further clues on the Fed’s policy path.
The Canadian Dollar (CAD) remains caught between several fundamental drivers. Recent weakness in Oil prices continues to weigh on the currency, as Canada remains one of the largest energy exporters to the United States (US). At the same time, major financial institutions offer mixed assessments of the Canadian economic outlook.
Rabobank argues that the economy remains fragile after two consecutive quarters of Gross Domestic Product (GDP) contraction, highlighting the negative impact of trade tensions with the US and weak investment activity. In contrast, RBC believes recent GDP figures overstate economic weakness due to the exceptional decline in population growth and sees Canada as being in the early stages of an economic recovery.
Attention now turns to Wednesday’s Bank of Canada policy announcement. Markets overwhelmingly expect the central bank to leave its policy rate unchanged at 2.25%. Rabobank also expects rates to remain at that level through year-end, arguing that policymakers are facing conflicting forces between energy-driven inflation risks and economic weakness stemming from external trade uncertainties.
Canadian Dollar Price Today
The table below shows the percentage change of Canadian Dollar (CAD) against listed major currencies today. Canadian Dollar was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.16% | -0.30% | 0.06% | 0.03% | 0.22% | -0.27% | -0.05% | |
| EUR | 0.16% | -0.12% | 0.24% | 0.19% | 0.43% | -0.07% | 0.14% | |
| GBP | 0.30% | 0.12% | 0.36% | 0.33% | 0.52% | 0.06% | 0.27% | |
| JPY | -0.06% | -0.24% | -0.36% | -0.04% | 0.16% | -0.33% | -0.11% | |
| CAD | -0.03% | -0.19% | -0.33% | 0.04% | 0.20% | -0.27% | -0.07% | |
| AUD | -0.22% | -0.43% | -0.52% | -0.16% | -0.20% | -0.46% | -0.26% | |
| NZD | 0.27% | 0.07% | -0.06% | 0.33% | 0.27% | 0.46% | 0.20% | |
| CHF | 0.05% | -0.14% | -0.27% | 0.11% | 0.07% | 0.26% | -0.20% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Canadian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CAD (base)/USD (quote).
UOB’s Enrico Tanuwidjaja and Vincentius Ming Shen note that Indonesia’s FX reserves fell further in May as Bank Indonesia (BI) stepped up interventions to support the Rupiah, which has weakened sharply year-to-date. They expect FX reserves to stay under pressure as risk-off sentiment persists, with BI likely to keep tightening policy and using FX operations to defend USD/IDR stability.
Reserves fall as BI defends rupiah
"Foreign exchange (FX) reserves declined to USD 144.9bn in May, extending their downward trend from USD 146.2bn in April (see Indonesia: FX Reserves erosioncontinued to stabilize rupiah) and marking a notable fall from the December 2025 peak of USD 156.5bn (see Indonesia: Dec reserves jumped on sukuk issuance). The primary driver of this contraction remains unchanged—Bank Indonesia’s (BI) interventions to stabilize the rupiah amid significant depreciation, with the currency down 7.38% year-to-date and closing May at IDR 17,874/USD."
"Despite this drawdown, reserve levels remain fundamentally robust, with an import cover ratio of 5.6 months (or 5.5 months when accounting for government external debt servicing), well above the international adequacy benchmark of 3.0 months. BI emphasized that reserves will continue to underpin external resilience, supported by potential capital inflows following a shift toward a more contractionary monetary stance (see Indonesia: BI’s surprise rate hike marks the start of atightening cycle)."
"Looking ahead, FX reserves are expected to remain under pressure due to persistent risk-off sentiment towards the rupiah. To defend the currency, BI’s policy toolkit is expanding beyond direct FX intervention to include interest rate adjustments."
"We anticipate that the current tightening cycle will continue, with the benchmark rate rising to 6.00% by end-2026. Additionally, the government has continued to embark on issuing more foreign currency-denominated sovereign bonds to help bolster gross reserves, albeit at the well-recognized cost of increasing future debt burdens."
"All these are necessary measures to continue anchoring the stability of the exchange rate."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Scotiabank’s Analyst Team notes Sterling is a moderate outperformer versus core majors, supported by broader risk appetite rather than domestic data. They highlight ongoing political uncertainty around the June 18 Makerfield by-election but see short-term technicals turning neutral to bullish, with a break above 1.3415 expected to open further gains toward 1.3475 in GBP/USD.
Sterling supported by risk sentiment
"Sterling is a relatively firm performer on the session so far, gaining versus most of its core major peers (ex NZD) as riskier FX outperforms."
"There were no UK data reports today so gains appear purely flow driven."
"Political uncertainty remains close to the surface for the GBP as investors monitor developments around the June 18th Makerfield by-election and the potential election of a leadership rival for PM Starmer."
"Neutral/bullish—Intraday gains from yesterday’s low just above 1.33 also suggest a minor low/reversal has been established for Cable."
"Gains through 1.3415 would add to short-term momentum and point to the pound gaining towards 1.3475."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- Gold struggles to benefit from a weaker US Dollar as higher-for-longer interest rate expectations weigh.
- US inflation data due Wednesday may offer fresh direction for Gold.
- Technically, bearish momentum remains in place as XAU/USD struggles below the Bollinger midline near $4,500.
Gold (XAU/USD) trades under modest pressure on Tuesday as a hawkish Federal Reserve (Fed) outlook offsets support from a weaker US Dollar (USD), while uncertainty surrounding Middle East peace negotiations keeps traders cautious.
At the time of writing, XAU/USD is trading around $4,282, retreating from an intraday high near $4,350 and hovering close to its lowest level since March, touched on Monday.
US President Donald Trump said negotiations with Iran are in the "final throes" and that an agreement could be reached within days. "We're in the final throes of what will be a very, very good deal," Trump told reporters on Tuesday. He added that the Strait of Hormuz would reopen as soon as a deal is finalized.
The comments added to optimism after Iran and Israel agreed to halt strikes following weekend hostilities. However, tensions remain elevated. Israel has continued military operations in Southern Lebanon, while Iran has warned that fighting could resume if Israeli attacks continue.
The next hurdle for Gold: US inflation
Traders are bracing for the US Consumer Price Index (CPI) report due on Wednesday.
Inflation has drifted further away from the central bank's 2% target, as higher Crude Oil prices following the outbreak of the war in the Middle East in late February have added to inflationary pressure. Annual CPI rose to 3.3% in March and 3.8% in April, with economists expecting a further increase to 4.2% in May.
A stronger-than-expected reading would cement bets on a rate hike later this year and increase pressure on Gold, which tends to perform well in a low-interest rate environment. In contrast, a softer inflation reading could allow the Fed to remain patient and trigger a short-term rebound in the precious metal.
Still, gains may be capped as markets remain convinced that interest rates will stay elevated for longer, unless a US-Iran agreement leads to a sustained decline in Oil prices and eases inflation concerns.
Technical analysis: XAU/USD stabilizes, but the technical picture remains fragile
On the daily chart, XAU/USD holds below the Bollinger Bands’ 20-period Simple Moving Average near $4,496 and slips beneath the lower band around $4,306, keeping the near-term tone bearish. The Relative Strength Index (RSI) hovers in the low 30s, hinting at persistent but not yet extreme downside pressure, while the Average Directional Index (ADX) near 29 points to a strengthening trend backdrop rather than range-bound trade.
On the topside, initial resistance emerges at the lower Bollinger Band near $4,306, with the 20-period SMA around $4,497 acting as a more meaningful cap, ahead of the upper band close to $4,687. On the downside, the next noteworthy cushion sits at the horizontal support line near $4,100, where a break would open the door to a deeper corrective leg within the broader bearish configuration.
(The technical analysis of this story was written with the help of an AI tool.)
Inflation FAQs
Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%.
The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls.
Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money.
Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
Rabobank describes Canada’s economy as fragile, with back-to-back quarterly contractions marking a technical recession and weak investment and trade dragging growth. Elevated gasoline prices risk demand destruction, while US tariffs and USMCA uncertainty weigh on business and consumer confidence, limiting the effectiveness of Bank of Canada policy in countering externally driven shocks.
Technical recession and weak investment
"Elevated gasoline prices means that the risk of demand destruction due to present inflation is high. This puts Canada in an especially precarious position given the recent GDP print, which registered contraction at -0.1% quarterly annualized."
"Poor investment has dragged down growth and there aren’t promising signs at this juncture to suggest that we’re seeing a dramatic turnaround in Q2. Meanwhile, the trade balance also supressed growth, as exports contracted by -0.5% and imports increased from 2% in Q4 of last year to 12% in Q1—the greatest increase since 2022."
"The Q1 print is concerning as it came after a contractionary print of -1.0% in the previous quarter—marking a technical recession. Several Canadian policymakers have brushed off this most recent activity print, with Mark Carney saying that the Canadian government has “been in the process of laying the foundations for a stronger, more resilient, more independent Canadian economy."
"We continue to expect the Canadian economy to grow modestly as it adjusts to US tariffs and trade policy uncertainty, but recent data suggest that near-term economic growth will be weaker than anticipated in January."
"The Bank’s April forecast projects GDP growth of 1.2% in 2026, rising to 1.6% in 2027 and 1.7% in 2028 as growth in exports and business investment resumes along a lower trajectory."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Brown Brothers Harriman’s (BBH) Elias Haddad reports that USD/CNH is falling toward support at its June multi-year low as broad Dollar weakness combines with China’s stronger-than-expected trade surplus, driven by AI-related exports and semiconductor imports. Haddad argues that continued CNY appreciation could aid China’s shift toward consumption and concludes that the USD/CNH downtrend remains intact.
AI trade strength and CNY appreciation
"USD/CNH is down on broad USD weakness, and nearing support at its June multi-year low of 6.7581. China’s May trade surplus widened more than expected powered by the AI supply chain."
"The trade surplus increased to a four-month high at $105.4bn as exports surged 19.4% y/y and imports soared 27.4% y/y, both well above consensus."
"Strong global demand for AI-related goods boosted shipments while import growth was driven by a surge in semiconductor imports. On an annual basis, China’s trade surplus remains massive at $1.17 trillion."
"In our view, a continued appreciation in China’s currency could help the country shift its growth model towards consumer spending by boosting disposable income through cheaper imports. Bottom line: USD/CNH downtrend is intact."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
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