The National Bureau of Statistics of China will release its quarterly GDP data at 02:00 GMT. For the third quarter, GDP is expected to rise by 0.8%, a drop from the 1.1% growth in the second quarter. Annually, the economy is projected to grow by 4.8%, down from 5.2%. Retail sales are predicted to increase by 2.9% year-over-year in September, compared to 3.4% previously. Industrial production is expected to rise by 5.0%, slightly down from 5.2%. The AUD/USD currency pair has been trading lower as these economic forecasts come in. If GDP and other figures exceed expectations, the Australian Dollar could strengthen, hitting resistance levels at 0.6523, 0.6560, and 0.6620. If the data disappoints, AUD/USD may test support at 0.6472, potentially falling to 0.6424 and the psychological level of 0.6400.

Impact of Higher GDP

Higher GDP figures typically help a nation’s currency by signaling economic growth. Conversely, lower GDP can hurt the currency, making the economy less attractive. A rising GDP often leads to inflation, which may prompt central banks to increase interest rates. This can negatively impact gold prices since higher rates increase the cost of holding the metal. With China’s Q3 GDP data available today, we anticipate a slowdown to a 0.8% quarterly growth from 1.1%. This expected weakness is already affecting the AUD/USD, which reacts to Chinese economic conditions. For derivative traders, this creates an opportunity to trade in the coming weeks. If the data surprises with an upward shift, surpassing the 0.8% consensus, we may consider buying AUD/USD call options or going long on futures. A stronger figure would indicate that Beijing’s targeted stimulus is working, potentially pushing the pair toward 0.6523 resistance. This could show that the market has been too negative about China’s recovery. On the other hand, if the GDP figure misses, it would confirm existing economic weaknesses. In this case, AUD/USD put options would be an appealing strategy. Such a result would likely lead the pair to test support at 0.6472, aligning with ongoing challenges in China’s economy throughout 2025.

Factors Beyond Headline GDP

Aside from the headline GDP number, we should closely examine retail sales and industrial production for a better understanding. China’s property investment continues to decline, down about 9% year-on-year in the first three quarters of 2025. A weak retail sales figure would suggest that low consumer confidence is hampering growth. From Australia’s viewpoint, the Reserve Bank of Australia has maintained its cash rate at a restrictive 4.35% most of the year to combat inflation. This high interest rate provides some support for the Aussie dollar, possibly softening its drop even if Chinese data is disappointing. Australia’s export volumes to China have remained stable, but commodity prices, like iron ore, have fallen from their 2024 peaks, creating a mixed scenario. We also need to consider the US dollar’s situation as the US federal government shutdown enters its 19th day. This political uncertainty is weighing on the dollar, which may limit AUD/USD’s downturn regardless of the Chinese data. The direction of the currency pair will depend on which economy is perceived as having a worse outlook. Looking at similar data releases from 2024, initial market reactions didn’t always reflect sustainable trends. Implied volatility for AUD/USD options is high, indicating uncertainty around this release. Strategies designed to profit from significant price movements in either direction may be worth considering. Create your live VT Markets account and start trading now.

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