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The Aussie and yen declined in Asia as China’s trade data showed a better-than-expected steady surplus, but gloomy imports.

USD/JPY traded at 102.02, up 0.23% pulled by a narrower-than-expected trade surplus in Japan, while AUD/USD changed hands at 0.7611, down 0.08% with the currency’s fortunes closely-tied to trade with China.     

Further, China’s trade balance for July settled at $52.31 billion surplus, higher than a $47.6 billion estimate, with exports seeing a 4.4% decline, posting below 3.0% drop seen. Imports showed a 12.5% drop, far worse than the earlier 7.0% seen, both year-on-year.

Japan’s adjusted current account touched ¥1.65 trillion, resting below the surplus of ¥3.20 trillion for July forecast. Bank lending rallied by about 2.1%, topping 2.0% expected gain.   

China’s FX reserves settled at CNY3.2 trillion, reaching expectations.

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Market players await a monetary policy report from the Reserve Bank of New Zealand on Wednesday amid mounting speculations for a rate cut.

The U.S. dollar index, which gauges the dollar’s strength against a basket of other major rivals, dropped 0.07% to 96.12 at the close.

Meanwhile, the greenback finds support after the U.S. employment data showed a more than expected increase in July, which raised expectations of a rate hike from the Federal Reserve for this year.

According to the Labor Department, the U.S economy increased 225,000 jobs last month, exceeding the 180,000 estimates. June’s number was revised up to 292,000 than the earlier forecast of 287,000.

However, a stagnation was seen in the unemployment rate of about 4.9%, as numbers of people have entered the labor market. The average hourly earnings was higher by 0.3% on a month-on-month, topping the a 0.2% expected gain, suggesting a 2.6% higher on the year.   

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Aussie Slips Amid Dollar Rally

The local unit was changing hands at 76.04 US cents during the course of Monday’s session, which was down from 76.48 on Friday.

A senior currency trader Stephen Innes mentioned that the greenback was holding up well despite struggling from the strengthening US dollar, which has continued rallying since backed by strong US jobs report.

"The Aussie dollar is clearly benefiting from the availability of cheap US finance, but it would be naive to assume the Aussie dollar would not experience substantial outflows if US rate hike expectations continue rising," he added.

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