- The AUD/USD is negotiated near the 0.6240 area in the American session on Thursday, extending profits in the middle of the renewed pressure on the USD.
- The scaling of tariffs with China and the contradictory comments of the Fed feed the fears of a slower growth and persistent inflation.
- Despite Thursday’s recovery, the AUD/USD is still technically bassist, with the limited rise by key mobile stockings.
The Australian dollar (AUD) extended its progress on Thursday, rising to the 0.6240 area during the American session. The torque was based on the recent strength while the American dollar index (DXY) fell even more towards minimums of several months near the 101st area. This movement occurred after the markets digested the confirmation of the White House of a 145% tariff on Chinese goods, combined with a cautious tone of the Federal Reserve (Fed).
Despite the drop in the dollar, the technical context for the AUD/USD remains inclined downward, with several key indicators that continue to show bassist signals, even when the pair tries to recover lost ground.
What moves the market today: Aussie rises while the US dollar falls to the inflation signals of the Fed and the commercial war
- The US dollar (USD) extended its fall on Thursday, pressed by the growing commercial tensions and softer inflation data. The DXY fell near the 101.00 zone while investors digest the last developments on tariffs and the cautionary rhetoric of the Fed.
- The 145% tariff of President Trump about Chinese imports remains in force, despite a temporary pause in some measures. Fed officials, including Goolsbee, Logan and Schmid, warned that tariff -induced price pressures could harm the feeling of the consumer, hinder the growth of employment and complicate monetary policy decisions.
- Initial applications for unemployment subsidy in the US increased slightly, reinforcing concerns about labor market cooling. Meanwhile, the March IPC report revealed a pronounced deceleration both in the underlying and general inflation, relieving minimum of several years.
- The Variable Income Markets returned part of the profits on Wednesday, with the Dow going back below 40,000 while the feeling became more cautious. Meanwhile, gold shot new historical maximums and the crude WTI resrupted the mid -week profits in the midst of concerns about demand.
- The Australian dollar gained ground against the weakened US dollar, even when the macroeconomic perspective for Australia remains fragile due to its exposure to Chinese demand, which is affected by reciprocal tariffs.
Technical analysis
Despite Thursday’s bullish impulse, the AUD/USD continues to face a technically bassist structure, with key resistance levels limiting a greater rise. The torque moved up to negotiate in the upper half of the recent range, but its positioning remains vulnerable.
The indicator of convergence/divergence of mobile socks (MACD) continues to print red bars, pointing out a persistent down pressure. Meanwhile, the Relative Force Index (RSI) is 48, suggesting a neutral momentum with a slight bearish inclination. Both the stochastic K K (at 37.57) and the product channel index (in -51.65) also show neutral tones, without offering a clear directional trend.
The bearish feeling is reinforced by a confluence of mobile socks that are inclined against buyers. Simple mobile stockings of 20 days, 100 days and 200 days have a descending slope, placing themselves above the action of the current price and limiting the profits. The 30 -day EMA and SMA – acting around 0.6230–0.6250 – also suggest additional resistance ahead.
Faqs Australian dollar
One of the most important factors for the Australian dollar (Aud) is the level of interest rates set by the Australian Reserve Bank (RBA). Since Australia is a country rich in resources, another key factor is the price of its greatest export, iron mineral. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and commercial balance. The feeling of the market, that is, if investors are committed to more risky assets (Risk-on) or seek safe shelters (Risk-Off), it is also a factor, being the positive risk-on for the AUD.
The Australian Reserve Bank (RBA) influences the Australian dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of the interest rates of the economy as a whole. The main objective of the RBA is to maintain a stable inflation rate of 2% -3% by adjusting the interest rates or the low. Relatively high interest rates compared to other large central banks support the AU, and the opposite for the relatively low. The RBA can also use relaxation and quantitative hardening to influence credit conditions, being the first refusal for the AU and the second positive for the AUD.
China is Australia’s largest commercial partner, so the health of the Chinese economy greatly influences the value of the Australian dollar (Aud). When the Chinese economy goes well, it buys more raw materials, goods and services in Australia, which increases the demand of the AU and makes its value upload. The opposite occurs when the Chinese economy does not grow as fast as expected. Therefore, positive or negative surprises in Chinese growth data usually have a direct impact on the Australian dollar.
Iron mineral is the largest export in Australia, with 118,000 million dollars a year according to data from 2021, China being its main destination. The price of iron ore, therefore, can be a driver of the Australian dollar. Usually, if the price of iron ore rises, the Aud also does, since the aggregate demand of the currency increases. The opposite occurs when the price of low iron ore. The highest prices of the iron mineral also tend to lead to a greater probability of a positive commercial balance for Australia, which is also positive for the AUD.
The commercial balance, which is the difference between what a country earns with its exports and what it pays for its imports, is another factor that can influence the value of the Australian dollar. If Australia produces highly requested exports, its currency will gain value exclusively for the excess demand created by foreign buyers who wish to acquire their exports to what you spend on buying imports. Therefore, a positive net trade balance strengthens the AUD, with the opposite effect if the commercial balance is negative.
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.
