Australian beef and wine exporters past year blamed politics when their products were held up at Chinese ports, after then-Prime Minister Malcolm Turnbull implicitly criticized Chinese meddling in Australian politics and universities. Earlier in the session, the Australian Dollar found support after RBA Governor Lowe declared house prices will not "derail" the economy while conceding the drop may be hurting some households.
The affected ports accept less than 2 per cent of all Australian coal exports.
To better gauge market movements, price indices such as the one published by Fastmarkets MB were introduced to the coking coal market over five years ago, and today, physical contracts between traders, end users and miners widely incorporate these.
For these reasons the January's jobs data was watched closely by the market more so than it normally would be.
"Those knee-jerk headlines of "Australia's number-one export destination has a ban on Australia's number-one export" were enough to knock the Aussie lower", Callow said. "Momentum in 2018 slowed dramatically through the year".
Meanwhile the Australian Dollar could come under pressure in the first half of next week, as economists forecast Australia will have registered a trade deficit in January.
"The minutes look a bit more hawkish than the market was expecting", said Tom di Galoma, managing director at Seaport Global Holdings in NY, with the Fed citing a strong economy and robust labor market.
Coal operations being carried out in Newcastle, Australia, in 2015.
Above: AUD/USD rate shown at daily intervals.
The dollar index advanced to a two-month high last week although demand for the U.S. currency has recently faded on hopes that the latest round of discussions between the world's two largest economies would help end their trade dispute. The Aussie was lower against all G10 currencies Thursday.
These forecasts, and other events, put a significant dent into the Australian Dollar Thursday.
If we were to get some type of actual trade deal, that could change everything and send this market much higher.
That marks the end of a 90-day truce that U.S. President Donald Trump and Chinese President Xi Jinping agreed to when they met in Argentina late previous year. According to a representative of the Dalian Port Group, the operator of the port of Dalian, overall coal imports have now been capped at 12 million tons for the year. Apart from coal, its main exports to China include iron ore and gold.
The Australian Dollar (AUD) has steadied this morning, as the currency recouped some ground overnight after nosediving on Thursday.
China, which has a history of using trade as leverage, has been seeking to counter resistance in several nations to using Huawei in 5G networks.
Investors eyed signs of progress in the latest round of trade negotiations between the U.S. and China amid expectations President Donald Trump will meet Chinese President Xi Jinping next month to strike a deal. "Whatever China does from here CNY is going to crumble at some point".
"We do not believe that this is isolated to Australia but may well be and is likely applicable to other coal exporters into China as well".