AUD/USD edges lower, China data beats expectations

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<li>China’s GDP beats expectations at 4.9%</li>
<li>Australian job growth expected to fall</li>
</ul>
<p>The Australian dollar started the day higher but has reversed directions. In the North American session, AUD/USD is trading at 0.6357, down 0.13%.</p>
<p>The US dollar has steamrolled the Aussie, which hasn’t posted a winning week since September and dropped close to a one-year low last week. The Australian dollar has bounced back this week, however, gaining 1.08%.</p>
<p>The situation in the Middle East remains perilous, with the risk that the Israel-Hamas war could spread and ignite a regional war. President Joe Biden has arrived in Israel, a move intended as a warning to Iran and others not to enter the conflict. The fighting has not affected risk sentiment, as investors haven’t panicked and snapped up greenbacks. Still, the Middle East is a powder keg at present and if the situation worsens, we could see a flight to the US dollar.</p>
<p>Australia will release employment numbers on Thursday. Job growth has been solid and posted a strong gain of 64,900 in August. Employment is expected to fall sharply to 20,000 in September. Unemployment has been at low levels and is expected to remain at 3.7% for a third straight month.</p>
<p>China is Australia’s number one trading partner, which means that Chinese releases can have a significant impact on the Australian economy. China’s post-Covid recovery has been much weaker than expected, and deflationary pressures and a property crisis could have negative implications for the global economy.</p>
<p>Chinese released key data on Wednesday and all three releases beat expectations. GDP for Q3 rose 4.9% y/y, above the consensus estimate of 4.4% but well shy of second-quarter growth of 6.3%. Retail sales for September climbed 5.5% y/y, up from 4.6% in August and above expectations of 4.9%. Finally, industrial production was unchanged in September at 4.5% y/y, compared to the consensus estimate of 4.3%. China’s economy may be in better shape than expected, but the road to recovery is likely to be a bumpy one.</p>
<p>.</p>
<p><strong>AUD/USD Technical</strong></p>
<ul>
<li>AUD/USD is putting pressure on support at 0.6343. Below, there is support at 0.6240</li>
<li>0.6399 and 0.6430 are the next resistance lines</li>
</ul>
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