AUD Soars Against JPY Despite China's Weak Economic Data
The Australian Dollar (AUD) continued its rally against the Japanese Yen (JPY), trading around 113.20 during European hours on Monday, despite weaker-than-expected economic indicators from China.
Data released by China's National Bureau of Statistics showed that July Retail Sales grew by just 0.6% year-over-year, missing the forecasted 1.5% and decelerating from June's 1.0%. Industrial Production expanded by 4.5% year-over-year, underperforming both the 5.0% consensus estimate and the prior 5.3% figure.
The weak economic data was attributed to extreme weather conditions, with an NBS spokesperson noting that China's core development trajectory remains intact.
Strategists at Brown Brothers Harriman expect this week's Australian labour market releases to have a limited impact on policy expectations, as the Q2 wage price index due Wednesday and the July labor force survey on Thursday are 'unlikely to shift the dial on RBA rate pricing.'
The potential upside for the AUD/JPY pair remains capped due to underlying strength in the Japanese Yen (JPY) following soft preliminary second-quarter GDP figures from Japan, which grew 0.3% quarter-over-quarter in Q2 2026, slowing from the 0.5% expansion recorded in Q1.