The Australian Bureau of Statistics reported that exports fell from 7.9% to 3.4% in October. This decline indicates a slowdown in trade, which could impact Australia’s economic growth.

Revised Export Figures

These new export figures might influence foreign exchange rates, particularly for the Australian dollar. Traders may change their strategies based on the updated trade balance. As global markets fluctuate, tracking export data is crucial to understand the country’s economic health. The drop in Australian exports from 7.9% to 3.4% signals weaker demand from abroad. This isn’t likely a one-time occurrence; it may indicate slower economic growth for the last quarter of 2025. This raises concerns for the Australian dollar (AUD). Given this situation, the risk for the AUD/USD pair is rising. Traders might want to consider strategies that profit from a potential decline. Buying AUD put options with strike prices below the 0.6500 support level could be wise in the coming weeks. This offers protection and profit opportunities if the currency weakens further with future data releases. This decline in exports comes as iron ore prices have decreased. Recently, they fell 15% from their November highs, trading below $100 per tonne due to renewed worries about China’s property market. Since resource exports are vital to the economy, this price drop strengthens the bearish outlook. We should expect pressure on major resource stocks listed on the ASX.

Reserve Bank of Australia’s Stance

Additionally, the latest meeting minutes from the Reserve Bank of Australia show a more cautious approach, removing previous mentions of tightening policy. This shift suggests that the central bank is unlikely to support the currency if inflation or employment figures also start to decline. Market expectations should now consider a greater chance that the RBA will maintain a neutral or even easing stance in early 2026. We’ve noticed implied volatility on the ASX 200 rising to 16.5, indicating increased market uncertainty. While this raises options costs, it also points to expected larger price swings. Traders might utilize strategies like bearish put spreads on the XJO to manage upfront costs while preparing for a possible market downturn. This trend is similar to the commodity downturn from 2014 to 2016, where slowing export growth preceded a multi-year drop in the AUD. This historical perspective suggests we should brace for this weakness to be more than just a short-term trend. The upcoming weeks will be crucial to determine if we are entering a similar cycle. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now