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AUD/USD struggles to hold above 0.6900, eyes on US data

  • Upbeat data from China failed to help AUD gather strength during Asian session.
  • Broad-based buying pressure on USD drags AUD/USD lower.
  • Industrial Production in US is expected to contract in December.

After posting modest daily losses on Thursday, the AUD/USD pair edged higher to 0.6912 on Friday but reversed its course ahead of the American session. As of writing, the pair was down 0.06% on the day at 0.6895. 

The data published by the National Bureau of Statistics of China on Friday showed that Industrial Production in 2019 expanded 6.9% to beat the market expectation of 5.9%. Additionally, Retail Sales rose 8% on a yearly basis to match November's reading. Finally, the Gross Domestic Product (GDP) expanded by 6% (YoY) in the fourth quarter as expected.

Nevertheless, the positive impact of the upbeat Chinese data on the AUD remained short-lived and the AUD/USD pair erased its gains ahead of the American session.

Focus shifts to US data, Fedspeak

The broad-based USD strength seems to be driving the pair lower on Friday. The poor performance of the major European currencies helps the greenback find demand with the US Dollar Index adding 0.19% on the day at 97.50.

The US economic docket will feature Building Permits, Housing Starts, and the University of Michigan's Consumer Confidence Index data on Friday. The Federal Reserve will publish its Industrial Production, which is expected to show a contraction of 0.2% in December, as well. Moreover, Philly Fed President Harker, The Fed's vice chairman of supervision Quarles and Fed Governor Bowman will be delivering speeches.

Technical levels to watch for

 

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