Dollar creeps higher ahead of US, China economic data

The dollar inched higher on Tuesday but traded in a narrow range as investors were hesitant to take on new positions ahead of a key U.S. inflation reading this week, while focus in Asia turned to China’s trade data out later in the day.

China’s exports are expected to fall 12.5% in July from a year earlier, based on a Reuters poll of economists, extending a drop of 12.4% in June and marking the worst reading since the early days of the pandemic in February 2020.

The trade figures come a day ahead of the country’s inflation reading, with markets on the lookout for further signs of deflation in the world’s second-largest economy.

Ahead of the data release, the offshore yuan was little changed at 7.2039 per dollar.

The Australian and New Zealand dollars, often used as liquid proxies for the yuan, were meanwhile weaker in early Asia trade.

The Aussie slipped 0.05% to $0.6571, while the kiwi fell 0.08% to $0.6102.

“This week’s economic data … will continue to paint a picture of a weak Chinese economic recovery,” said Carol Kong, a currency strategist at Commonwealth Bank of Australia.

This report’s information was first seen on ZAWYA; to read more, click this link.