Risk sentiment dominated the market on Tuesday causing investors to turn to the safe-haven currency US dollar.
In the Asian session, data from China showed that the trade surplus widened to $80.6 billion in July from $70.6 billion in June.
However, exports and imports declined by 14.5% and 12.4% respectively on a year-on-year basis, fueling concerns over continued weakness in the economic recovery.
Investors are also worried about the publication of China's inflation data tomorrow (Wednesday), which is expected to record negative figures or experience deflation in July.
The concern, pressured the Aussie and New Zealand dollar trading lower to the weakest level in two months against the greenback in today's trading session.
The dollar index, which measures the strength of the greenback, strengthened at around 102.33 against most major currencies.
Even so, the overall movement of the currency has not changed much and is still moving around the same price zone.
This is because investors are more cautious ahead of the release of important inflation data from China and the United States.
The euro continued to trade hovering below the 1.1000 price level against the US dollar amid the absence of key data to act as a catalyst.
Meanwhile, the pound eased slightly at around 1.2750 against the greenback with investors paying attention to UK economic data on Friday.
The yen continued to trade lower against the greenback, but rose slightly against other major currencies supported by safe-haven demand.
