- The Australian dollar maintains its position near the psychological level of 0.6500 after retreating a maximum of six months of 0.6537.
- The audience faces few challenges due to a Dovish feeling around RBA’s policy perspectives.
- The US dollar fights for concerns about the fiscal deficit while Trump’s tax bill is about to be voted in the Senate.
The Australian dollar (Aud) remains subdued against the US dollar (USD) for the second consecutive day on Tuesday. However, the Aud/USD torque maintains its position near the psychological level of 0.6500 after going back a maximum of six months of 0.6537, reached on Monday. However, the continuous fall of the US dollar provides support for the torque, which could be attributed to the growing fears about the debt concerns of the United States (USA).
The Aud/USD torque could recover land as the dollar faces additional challenges in the middle of a positive risk feeling, driven by the decrease in commercial tensions between the United States (USA) and the European Union (EU). The president of the United States, Donald Trump, extended the deadline of tariffs to the European Union (EU) from June 1 to July 9 after a phone call with the president of the European Commission, Ursula von der Leyen, on Sunday. On Friday, Trump threatened to impose a 50% tariff on imports from the European Union (EU).
The Bank of the Australian Reserve (RBA) is expected to carry out more interest rate cuts in the upcoming policy meetings, which could limit the bullish potential of the Australian dollar. The Australian Central Bank made a 25 basic points rate cut last week. In addition, Governor Michele Bullock declared that the Central Bank is prepared to take additional measures if economic perspectives deteriorate drastically, increasing the possibility of future feat cuts.
The Aud received support from the 90 -day commercial truce between the US and China, together with the expectations of more US trade agreements with other countries. The markets will be attentive to additional developments in commercial negotiations between the US and China, since China is an important commercial partner of Australia.
The Australian dollar remains subdued despite a weaker US dollar amid increasing debt concerns
- The US dollar index (DXY), which measures the value of the dollar against six main currencies, continues to lose ground due to third consecutive session on Tuesday. The DXY is quoted around 98.80 at the time of writing. The operators will probably observe the requests for lasting goods, the manufacturing index of the Dallas Fed and the consumer conference report of the Board Conference that will be published later in the North American session.
- The US fiscal deficit could increase even more when Trump’s “One Big Beautiful Bill” passes through the Senate, increasing the risk that bond yields stay high for longer. The highest bond yields can maintain the highest indebtedness costs for consumers, companies and governments.
- The Trump bill is expected to increase the deficit at 3.8 billion dollars, since it would offer tax cuts on tips revenues and cars manufactured in the US, according to the Congress Budget Office (CBO).
- The American senator Ron Johnson told CNN on Sunday that “I think we have enough votes to stop the process until the president takes seriously the reduction of spending and reducing the deficit.” Johnson added: “My main approach is now spending. This is completely unacceptable. Current projections are a deficit of 2.2 billion dollars per year.”
- While talking in Japan on Monday, the president of the Fed of Minneapolis, Neel Kashkari, said that “uncertainty is the main concern for Fed and US companies.” Kashkari said that prolonged tariffs increase the risk of stagflation, questioning the magnitude of stagflation. He expressed doubts that the situation is clear enough for September.
- The president of the Federal Reserve of Chicago (Fed), Austan Goolsbee, said Friday that Trump’s latest tariff threats probably postpone changes in interest rates. Meanwhile, Kansas City Fed President Jeffrey Schmid said that policies responsible will evaluate concrete data before formulating decisions about interest rates, and the Fed needs to be careful with the importance it gives to soft data.
- The governor of the Fed, Christopher Waller, said Thursday that the markets are monitoring the fiscal policy. Waller added that if the tariffs are about 10%, the economy would be in good shape for the second semester, and the Fed could be in a position to cut later in the year.
- The US dollar continues to fight after Moody’s reduced the US credit rating of AAA to AA1, after similar sales by Fitch Ratings in 2023 and Standard & Poor’s in 2011. Moody’s now projects that the Federal debt of the US will reach around 134% of the GDP by 2035, compared to 98% in 208% in 208% in 208% in 208% in 208% with the budget deficit that is expected to be extended to almost 9% of GDP. This deterioration is attributed to the growing cost service costs, the expansion of the rights programs and the fall in fiscal income.
- The China Ministry of Commerce said last week that US measures on China’s advanced chips are “typical of unilateral intimidation and protectionism” and hinder the stability of the industrial chain and global supply of semiconductors. Chinese authorities asked the United States to quickly correct their wrong practices.
- The operators will be attentive to relations between Australia and China, since the Chinese ambassador has criticized Australia’s plan to renounce the lease of the port of Darwin. The port was leased to the Chinese company Landbridge in 2015 for 99 years. The Chinese embassy described this decision as an unfair and unusual movement, according to Reuters.
The Australian dollar remains below 0.6500 after decorating a maximum of six months
The aud/USD torque is quoted around 0.6490 on Tuesday, with daily technical indicators that suggest a persistent bullish bias, since the torque is maintained above the nine -day exponential (EMA) mobile average. In addition, the 14 -day relative force (RSI) index maintains its position above 50, supporting an upward perspective.
The aud/USD torque could try a maximum of six months at 0.6537. A successful rupture above this level could reinforce the bullish bias and take the torque to approach to the maximum of seven months in 0.6687, registered in November 2024.
At the bottom, the nine -day EMA of 0.6456 would act as an immediate support, followed by the 50 -day EMA about 0.6380. The decisive breakdown below these levels would weaken the impulse of short and medium term prices and open the doors so that the torque navigate in the region around 0.5914, the lowest since March 2020.
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 weakest currency against the Japanese yen.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.14% | -0.13% | -0.44% | -0.07% | -0.01% | 0.03% | -0.18% | |
| EUR | 0.14% | -0.01% | -0.31% | 0.08% | 0.05% | 0.08% | -0.06% | |
| GBP | 0.13% | 0.00% | -0.27% | 0.08% | 0.06% | 0.08% | -0.10% | |
| JPY | 0.44% | 0.31% | 0.27% | 0.40% | 0.44% | 0.40% | 0.27% | |
| CAD | 0.07% | -0.08% | -0.08% | -0.40% | 0.03% | 0.00% | -0.17% | |
| Aud | 0.01% | -0.05% | -0.06% | -0.44% | -0.03% | -0.06% | -0.23% | |
| NZD | -0.03% | -0.08% | -0.08% | -0.40% | -0.01% | 0.06% | -0.21% | |
| CHF | 0.18% | 0.06% | 0.10% | -0.27% | 0.17% | 0.23% | 0.21% |
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).
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.
