Dollar virtually unchanged ahead of China data

THE Australian dollar is treading water as nervous investors await key Chinese trade figures.

Australian dollar coins in piles of increasing sizes on top of $100 notes

THE Australian dollar is treading water as nervous investors await key Chinese trade figures.

At 0700 AEDT on Wednesday, the local unit was trading at 69.86 US cents, up from 69.81 cents on Tuesday.

Investors are wary of taking any big positions in the currency ahead of China’s December trade balance data on Wednesday, Kathy Lien, managing director at BK Asset Management said.

Ms Lien said two dynamics were keeping the Australian dollar stuck in a tight range.

“China’s repeated efforts to stabilise its financial markets is helping to prevent the Aussie from falling further,” she said.

“At the same time, there’s concern that growth is slowing in China and (investors) fear that tonight’s trade numbers will be weak. So that’s keeping the currency under pressure.”

Westpac strategist Imre Speizer said further ranging between 69.30 US cents and 70.35 US cents was possible, but the downside remained vulnerable during the days ahead.

He predicted the next major downside target would be a four-month low of 69.00 US cents.

CURRENCY SNAPSHOT AT 0700 AEDT ON WEDNESDAY

One Australian dollar buys:

* 69.86 US cents, from 69.81 cents on Tuesday

* 82.15 Japanese yen, from 82.03 yen

* 64.35 euro cents, from 64.18 euro cents

* 106.85 New Zealand cents, from 106.45 NZ cents

* 48.40 British pence, from 48.06 pence

(*Currency closes taken at 1700 AEDT previous local session)

Source: IRESS