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The Australian share market is tipped to open higher this week, taking strong leads from Wall Street amid growing optimism US-China trade tensions are beginning to ease.

Both US and European markets closed higher last week, with soft US economic data being outweighed by indications President Trump and his Chinese counterpart are making progress in trade talks.

The ASX is expected to open around 20 points higher on Monday, according to AMP Capital’s chief economist Shane Oliver.

‘I think the positive news on trade seems to be dominating any softer economic data out of the US, that’s what pushed it higher and benefited Europe as well,’ Dr Oliver told AAP on Sunday.

The Reserve Bank is expected to leave rates on hold on Tuesday, but Dr Oliver said more attention would be paid to its governor’s speech on Wednesday.

‘Obviously the speech will probably be looked at a bit more than the decision itself because the speech will be longer,’ he said.

Dr Oliver expects the RBA to cut rates in September, and then again in November.

The market will also be watching for GDP data to be released this week, with a slight bounce back expected after a poor September quarter.

‘The problem is that the indications we’ve got so far on consumer spending, trade, and even construction activity have been fairly soft,’ Dr Lowe said.

While the consensus is for GDP growth to be up .5 per cent, Dr Oliver said it could be as low as .2 per cent.

Retail sales figures to be released on Thursday could also show a slight rise after a weak December.

Meanwhile Dr Lowe said investors would be keeping an eye on the NSW election and any policy that could upset expectations of continued growth in local infrastructure spending.

‘That would be seen as a bit of a concern because it’s one source of support for the Aussie economy when housing is slowing down,’ Dr Oliver said.