- The Australian dollar goes up while the US dollar fights after the moderate comments of Fed officials.
- The president of the Fed of San Francisco, Mary Daly, said that waiting for two rates cuts this year is a “reasonable” perspective.
- US retail sales increased 0.6% intermensual, while retail sales rose 3.9% year -on -year in June.
The Australian dollar (AUD) advances on Friday, recovering more than 0.5% of the losses of the previous session. The Aud/USD torque can be seen while the US dollar (USD) faces challenges due to moderate comments of Federal Reserve (FED) officials.
The president of the Fed of San Francisco, Mary Daly, said that waiting for two rates cuts this year is a “reasonable” perspective, while warning against waiting too much time. Daly added that rates will eventually be set at 3% or more, which is higher than the neutral rate prior to the pandemic.
The governor of the Fed, Christopher Waller, said in the last minute of Thursday that he believes that the Central Bank of the US should reduce its interest rate objective at the July meeting, citing growing economic risks. Waller added that delaying cuts runs the risk of needing a more aggressive action later.
However, the Governor of the FOMC, Adriana Kugler, said that the US Central Bank should not lower interest rates “for some time” since the effects of Trump administration tariffs are beginning to be reflected in consumer prices. Kugler added that a restrictive monetary policy is essential to maintain aligned inflation psychology.
The Australian dollar can be seen while the US dollar falls before the feeling of the consumer of the University of Michigan
- The American dollar index (DXY), which measures the value of the US dollar compared to six main currencies, is lowering and quoting around 98.50 at the time of writing. Operators are likely to observe the feeling of the consumer of the University of Michigan, the construction permits and the beginnings of housing later on Friday.
- The US retail sales increased an intermensual 0.6% in June compared to -0.9% previous. This figure exceeded the market consensus of 0.1%. Meanwhile, annual retail sales rose 3.9%, compared to an increase of 3.3% in May.
- The US Production Price Index. Meanwhile, the underlying IPP rose 2.6% year -on -year compared to the previous 3.0%, softer than the 2.7% expected.
- The last Beige book of the Fed shows that, although the general business activity remains healthy and inflationary pressures are relatively moderate, underlying cost pressures are increasing and business operators remain cautious.
- The president of the USA, Donald Trump, said Wednesday that he plans to send letters to more than 150 countries, notifying them of a 10% tariff rate they will face. He emphasized that these are “not large countries” with limited commercial links with the US, unlike China or Japan. He also hinted that the rate could increase to 15-20%, although it did not confirm any specific detail.
- President Trump said in an interview with the Royal Network of America’s Voice on Wednesday that he would love that the president of the FED, Jerome Powell, resigned, but that would disturb the markets if the president removed it. He also mentioned the possibility of reaching an agreement with Europe. As for tariffs on Canada, he said it is too early to comment. However, a tariff agreement with India is very close.
- China’s economy expanded at an annual 5.2% rate in the second quarter, compared to a growth of 5.4% in the first quarter and the expected growth of 5.1%. Meanwhile, the Chinese Gross Domestic Product rate (GDP) increased 1.1% in the second quarter, against the market consensus of a 0.9% increase. In addition, retail sales increased 4.8% year -on -year in June, compared to 5.6% expected and 6.4% previous, while industrial production stood at 6.8%, compared to 5.6% expected.
- The Australian Statistics Office reported Thursday that the change in employment was seasonally adjusted 2K in June, recovering from an previous 2.5K fall in May, although well below the 20K new expected jobs. Meanwhile, the unemployment rate rose to 4.3% from the previous 4.1%. The figure exceeded the 4.1%market consensus.
- The Westpac consumer’s confidence in Australia on Tuesday, which rose 0.6% intermencing in July, after an increase of 0.5% in June. This marked a third consecutive monthly increase, pointing out a modest but encouraging improvement in the consumer’s perspective.
The Australian dollar quotes around 0.6500 after bouncing from the 50 -day Ema
The AUD/USD quotes around 0.6510 on Friday. The technical analysis of the daily chart indicates that a bullish bias is active since the torque is positioned within the ascending channel pattern. However, the 14 -day relative force index (RSI) is positioned below level 50, suggesting that market bias is weakening. The pair remains below the nine -day exponential mobile average (EMA), indicating that the impulse of the short -term price is weakening.
Down, the 50 -day EMA at 0.6490 acts as an immediate support. A successful breakdown below this level would weaken the impulse of the short -term price and exert down pressure on the AUD/USD torque to approach the lower limit of the upward channel around 0.6460, aligned with the minimum of three weeks at 0.6454, which was recorded on July 17.
The Aud/USD torque could aim at the EMA of nine days at 0.6524. A rupture above this level could strengthen the impulse of the short -term price and support the torque to approach to the maximum of eight months of 0.6595, which was reached on July 11.
AUD/USD: Daily graphic
Australian dollar Price today
The lower table shows the percentage of change of the Australian dollar (AUD) compared to the main currencies today. Australian dollar was the strongest currency against the US dollar.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.26% | -0.11% | -0.04% | -0.09% | -0.24% | -0.28% | -0.26% | |
| EUR | 0.26% | 0.15% | 0.21% | 0.15% | 0.05% | -0.15% | -0.00% | |
| GBP | 0.11% | -0.15% | 0.04% | 0.02% | -0.13% | -0.25% | -0.13% | |
| JPY | 0.04% | -0.21% | -0.04% | -0.03% | -0.19% | -0.35% | -0.11% | |
| CAD | 0.09% | -0.15% | -0.02% | 0.03% | -0.17% | -0.27% | -0.16% | |
| Aud | 0.24% | -0.05% | 0.13% | 0.19% | 0.17% | -0.12% | -0.01% | |
| NZD | 0.28% | 0.15% | 0.25% | 0.35% | 0.27% | 0.12% | 0.11% | |
| CHF | 0.26% | 0.00% | 0.13% | 0.11% | 0.16% | 0.00% | -0.11% |
The heat map shows the percentage changes of the main currencies. The base currency is selected from the left column, while the contribution currency is selected in the upper row. For example, if you choose the Australian dollar of the left column and move along the horizontal line to the US dollar, the percentage change shown in the box will represent the Aud (base)/USD (quotation).
Australian dollar – frequent questions
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 ore 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.
