- The AUD/USD remains under a certain selling pressure on Friday in the middle of a modest strength of the USD.
- The disappointing employment data on Thursday weakens the AU and contribute to the fall.
- Optimism about China’s stimulus and hopes of a commercial agreement between the US and China limit losses.
The Aud/USD fails to take advantage of the night rebound from the 0.6270 or a minimum of one week and meets new sales on Friday. Cash prices remain depressed below the 0.6300 brand during the first European session and could further fall in the middle of a rebound in the demand of the US dollar (USD).
The Federal Reserve (FED) maintained its prognosis of two 25 -point rate cuts in 2025 at the end of the March monetary policy meeting on Wednesday and raised its inflation projection. The perspective helps the dollar to consolidate its modest recovery from a minimum of several months for the third consecutive day and to reach a new weekly maximum. Apart from this, concerns about the possible economic repercussions of the commercial tariffs of US President Donald Trump and geopolitical risks benefit the dollar shelter. This, in turn, is observed exerting pressure on the aud/usd torque.
The Australian dollar (Aud), on the other hand, is weakened by the disappointing Internal Employment Report published Thursday, which showed that the number of people used decreased by 52.8K in February. The reading did not comply with the consensus estimates of an increase of 30.0K for a wide margin and generated concerns about a possible weakness in the labor market. This could provide the Bank of the Australian Reserve (RBA) more margin to reduce interest rates, which keeps the AUD bulls on the defensive and contributes even more to the sales tone around the aud/usd torque.
Any significant appreciation of the USD, however, still seems elusive in the midst of the expectations that the Fed will resume its cycle of rates cuts before expected due to concerns about a slowdown in economic activity in the US promoted by tariffs. In addition, the optimism about the recent stimulus measures of China and the hopes of a commercial agreement between the US and China could limit the losses for the AU, which acts as Proxy of China. The American Senator Steve Daines will visit China for commercial conversations, marking the first high -level political meeting from Trump’s return, to reactivate the marked negotiations stagnant in the midst of growing tariff tensions.
Looking ahead, there are no relevant economic data that can move the market scheduled for publication from the US on Friday, leaving the USD at the mercy of influential members of FOMC. This, in turn, could provide some impetus to the AUD/USD and generate short -term trading opportunities for the weekend. However, cash prices are still on the way to register losses for the first time in three weeks, since attention now focuses on the publication of preliminary global PMIs on Monday.
Commercial War between the US and China Faqs
In general terms, “Trade War” is a commercial war, an economic conflict between two or more countries due to the extreme protectionism of one of the parties. It implies the creation of commercial barriers, such as tariffs, which are in counterbarreras, increasing import costs and, therefore, the cost of life.
An economic conflict between the United States (USA) and China began in early 2018, when President Donald Trump established commercial barriers against China, claiming unfair commercial practices and theft of intellectual property by the Asian giant. China took retaliation measures, imposing tariffs on multiple American products, such as cars and soybeans. The tensions climbed until the two countries signed the Phase one trade agreement between the US and China in January 2020. The agreement required structural reforms and other changes in China’s economic and commercial regime and intended to restore stability and confidence between the two nations. Coronavirus pandemia diverted the attention of the conflict. However, it is worth mentioning that President Joe Biden, who took office after Trump, kept the tariffs and even added some additional encumbrances.
Donald Trump’s return to the White House as the 47th US president has unleashed a new wave of tensions between the two countries. During the 2024 election campaign, Trump promised to impose 60% tariff particularly in investment, and directly feeding the inflation of the consumer price index.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
