The Australian Dollar (AUD) has appreciated following the release of Chinese trade data on Monday. China’s March Trade Balance registered at $102.64 billion, surpassing expectations of $77 billion, although lower than the previous $170.51 billion. Concurrently, the US Dollar (USD) is facing downward pressure due to softening economic indicators and dovish monetary policy signals from the Federal Reserve. The AUD/USD pair’s gains are further bolstered by improved risk appetite, catalyzed by US President Trump’s announcement of less stringent tariffs on Chinese imports, specifically semiconductors and electronics. These goods will be subject to existing 20% tariffs related to fentanyl, rather than the previously considered 145% duties. Elevated commodity prices are also contributing to the AUD’s strength. However, ongoing trade tensions between the US and China continue to pose a risk, particularly given Australia’s significant reliance on Chinese demand and export activity. China’s March Trade Balance, denominated in Chinese Yuan (CNY), increased substantially to CNY 736.72 billion, a significant rise from the previous CNY 122 billion.
