The Australian dollar has risen Tuesday trading at 71.97 US cents from 71.86 US cents on Monday.

Yesterday, the local currency has backtracked after surprisingly soft data on Chinese trade stoked concerns the protracted tariff standoff with the United States was taking a heavy toll on the Asian giant.

The Aussie dollar eased to 71.85 US cents, after topping out at a three-week peak of 72.35 US cents on Friday.

The next resistance level on the charts is at 72.47 US cents with support at 71.80.

China reported dollar-denominated exports fell 4.4 per cent in December, from a year earlier, while imports dropped 7.6 per cent for the largest decline since July 2016.

Both badly missed analyst forecasts, a negative for Australia given China is its single biggest export market.

“The trade figures are immediately weighing on commodity and equity markets, and associated currency baskets,” said Stephen Innes, head of trading APAC at OANDA.

“Fairly damaging data and should reverse this morning’s rally on the yuan and other Asia emerging market currencies.”

The Aussie has a habit of tracking movement in the yuan as investors use it as a liquid proxy for wagers on China’s outlook.

A fresh test of risk appetite will come on Tuesday when the British parliament votes on Prime Minister Theresa May’s Brexit deal amid expectations the bill will be rejected.

A defeat will mean May has just three days to come up with an alternate plan or risk crashing out of the European Union on the March 29 deadline.

There were reports the EU might allow an extension of the deadline, which would support sterling and risk sentiment in general.

For now, the China news slugged share markets across Asia and boosted sovereign bonds.

Australian three-year bond futures firmed three ticks to 98.235, while the 10-year contract rose 3.5 ticks to 97.7250.