China’s trade balance for December, in CNY terms, reached CNY808.80 billion, expanding from the previous figure of CNY792.57 billion.
Exports rose by 5.2% year-on-year in December compared to 5.7% in November. The country’s imports rose by 4.4% year-on-year in the same period, compared to 1.7% recorded previously.
In US dollars, China’s trade surplus expanded more than expected in December.
The trade balance reached +114.10 billion, compared to the expected +113.60 billion and the previous +111.68 billion.
Exports (on an annual basis): 6.6% versus the expected 3.0% and the recent 5.9%.
Imports (on an annual basis): 5.7% versus the expected 0.9% and the previous 1.9%.
Market reaction to China’s trade balance
AUD/USD extends gains around 0.6692 in immediate reaction to Chinese trade data. The pair rose by 0.16% during the day as of writing this report.
Australian dollar price today
The table below shows the percentage change in the Australian Dollar (AUD) against the major currencies listed today. The Australian dollar was the strongest against the Swiss franc.
| US dollars | euro | GBP | JPY | Canadian | Australian dollar | New Zealand dollar | Swiss franc | |
|---|---|---|---|---|---|---|---|---|
| US dollars | 0.00% | -0.05% | 0.06% | 0.05% | -0.15% | -0.07% | 0.06% | |
| euro | -0.01% | -0.05% | 0.04% | 0.03% | -0.16% | -0.08% | 0.05% | |
| GBP | 0.05% | 0.05% | 0.13% | 0.10% | -0.10% | -0.03% | 0.11% | |
| JPY | -0.06% | -0.04% | -0.13% | 0.00% | -0.20% | -0.12% | 0.02% | |
| Canadian | -0.05% | -0.03% | -0.10% | -0.00% | -0.20% | -0.12% | 0.01% | |
| Australian dollar | 0.15% | 0.16% | 0.10% | 0.20% | 0.20% | 0.08% | 0.21% | |
| New Zealand dollar | 0.07% | 0.08% | 0.03% | 0.12% | 0.12% | -0.08% | 0.13% | |
| Swiss franc | -0.06% | -0.05% | -0.11% | -0.02% | -0.01% | -0.21% | -0.13% |
The heat map shows the percentage changes in major currencies versus each other. The base currency is chosen from the left column, while the counter currency is chosen from the top row. For example, if you select the Australian dollar from the left column and move along the horizontal line to the US dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
This section was published on Wednesday at 00:52 GMT as an introduction to China’s trade balance data.
Overview of China’s trade balance
The General Administration of Customs will publish its data for December on Wednesday at 03.00 GMT. The trade balance is expected to expand to $113.60 billion in December, compared to $111.68 billion in the previous reading. Exports are expected to rise by 3.0% year-on-year in December, while imports are expected to rise by 0.9% year-on-year during the same period.
Since the Chinese economy has an impact on the global economy, this economic indicator will have an impact on the Forex market.
How could China’s trade balance affect AUD/USD?
AUD/USD is trading positively during the day ahead of China’s trade balance data. The pair fell as the US Dollar (USD) rose after data showed that Consumer Price Index (CPI) inflation data was largely as economists expected last month.
If the data comes in better than expected, it could push the Australian dollar (AUD) higher, with the first upward barrier seen at the January 12 high of 0.6722. The next resistance level appears at the January 6 high of 0.6742, on its way to the January 7 high of 0.6766.
On the downside, the January 9 low at 0.6663 will provide some relief to buyers. Extended losses could see a drop to the December 4, 2025 low of 0.6614, followed by the 100-day moving average at 0.6587.
Frequently asked questions about the Australian dollar
One of the most important factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country, another major driver is the price of its largest export, iron ore. The health of the Chinese economy, its largest trading partner, is one factor, in addition to Australia’s inflation, its growth rate and its trade balance. Market sentiment – whether investors are snapping up riskier assets (risk on) or looking for safe havens (risk off) – is also a factor, with risk appetite positive for the Australian dollar.
The Reserve Bank of Australia (RBA) influences the Australian dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This affects the level of interest rates in the economy as a whole. The RBA’s main objective is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the Australian dollar, and relatively low interest rates. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former being AUD negative and the latter AUD positive.
China is Australia’s largest trading partner, so the health of the Chinese economy has a major impact on the value of the Australian Dollar (AUD). When the Chinese economy is performing well, it buys more raw materials, goods and services from Australia, which raises demand for the Australian dollar, raising its value. The opposite is the case when the Chinese economy does not grow as quickly as expected. Therefore, positive or negative surprises in Chinese growth data often have a direct impact on the Australian dollar and its crosses.
Iron ore is Australia’s largest export, representing $118 billion annually according to 2021 data, and China is its main destination. Therefore, the price of iron ore could be a driver of the Australian dollar. In general, if the price of iron ore rises, the Australian dollar also rises, as overall demand for the currency increases. The opposite is the case if the price of iron ore falls. Higher iron ore prices also tend to increase the likelihood of a positive trade balance for Australia, which is also positive for the Australian dollar.
The balance of trade, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can affect the value of the Australian dollar. If Australia produces highly sought-after exports, its currency will gain value from the excess demand generated by foreign buyers seeking to buy its exports in exchange for what it spends to buy imports. Therefore, a positive net trade balance strengthens the Australian dollar, with the opposite effect if the trade balance is negative.
