AUD/USD offers little response to weak China data

A weaker-than-expected China data dump clipped a pip or two off the AUD/USD pair, leaving it largely unchanged around 0.7390 levels.

China’s April industrial production rose 6.5% y/y in April, missing the estimate of 7.1%. The retail sales jumped 10.7%, beating the estimate of 10.7%. Urban investment growth dropped to 8.9% from 9.2%.

The drop in the industrial production in April is hardly surprising given the PBOC’s crackdown on the leverage. Plus, the better-than-expected retail sales saved the day for the Aussie.

With China data out of the way, markets may look towards the drop in the Fed rate hike bets following Friday’s dismal US retail sales and inflation number.

AUD/USD Technical Levels

A break below 0.7372 would open doors for 0.7338 (May 10 low) and 0.73 (zero figure). On the higher side, breach of hurdle at 0.7402 (10-DMA) would open up upside towards 0.7440 (Apr 27 low) and 0.7473 (Apr 12 low).