Dollar falls as Chinese trade data shows positive market mood

The dollar fell on Tuesday while risk currencies rallied after China’s trade data showed a more optimistic view than anticipated. The coronavirus death toll slowdown brought hopes to investors that the pandemic may be over soon.

Yuan-denominated exports declined 3.5% year-on-year, while imports gained 2.4%, according to customs data on Tuesday.

The Australian dollar was up 0.7%, at $0.6432, the New Zealand dollar rose 0.6%, at $0.6131, and the British pound increased 0.4%, at $1.2562.

Dollar-denominated Chinese exports are forecasted by analysts to fall 14% and imports 9.5%.

The Japanese yen steadied at 107.60 per dollar, after sliding a fraction from its two-week peak on Monday. The euro recovered its losses and traded at $1.0943.

A more positive mood in the markets was also seen in Asian equities. However, market fears remained and capped further gains in currencies.

Earnings for S&P 500 firms are anticipated to fall 10.2% in the first quarter, replacing the initial forecast of 6.3% gain in January.

Concerns about global recession continue to loom over the market, analysts said.