- The Australian dollar is strengthened in the midst of a renewed optimism, driven by the opening of Trump to new commercial negotiations.
- Consumer confidence in Australia marked a third consecutive monthly increase in July, pointing out an improvement in consumer perspectives.
- President Trump is prepared to impose tariffs greater than 10% to smaller countries, including several in Africa and the Caribbean.
The Australian dollar (AUD) advances against the US dollar (USD) on Wednesday, stopping its three -day loss streak. The Aud/USD torque can be seen as the US dollar falls in the middle of a renewed optimism, driven by the disposition of US President Donald Trump to participate more in commercial discussions. Trump indicated the possibility of negotiating with the European Union (EU) and other key commercial partners, which would relieve investors’ concerns about an escalation in the commercial dispute.
The University of Melbourne (UOM) published the Westpac Consumer Confidence Index on Tuesday, which rose 0.6% month by month 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 consumer perspectives.
The operators expect the Employment Report on Thursday of the Australian Statistics Office, with a change in employment that awaits 20,000 jobs added in June. In addition, the unemployment rate is expected to remain stable at 4.1%.
The AU could face challenges since markets expect 80% probability of a rate cut of the Bank of the Australian Reserve (RBA) in August. The markets also await a 75 basic points cut for the beginning of 2026. However, the governor of the RBA, Michele Bullock, declared that the risks of inflation persist, citing the high unit labor costs and the weak productivity as factors that could boost inflation above the current projections.
The Australian dollar advances while the US dollar is moderated before the PPI data
- 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. The operators expect the US Production Price Index (PPI).
- The Associated Press reported that US President Donald Trump is preparing to introduce tariffs greater than 10% to smaller countries, including nations in Africa and the Caribbean. “We will probably establish a tariff for all of them,” Trump told reporters on Tuesday.
- The US Consumer Price Index (ICC) rose 2.7% year -on -year in June, complying with market expectations. The underlying ICC stood at 2.9%, just below the 3.0% prognosis but still significantly above the 2% target of the Federal Reserve. The June inflation figures, higher than expected, revived concerns about prolongly high interest rates of the Fed.
- US President Donald Trump has threatened to impose “very severe” tariffs on Russia if a peace agreement is not reached in 50 days. Trump also warned of tariffs secondary to countries that import Russian oil. In addition, Trump, together with NATO general secretary, Mark Rutte, confirmed that European allies will buy weapons made in the US for bills of dollars, such as Patriot missile systems. These weapons will be transferred to Ukraine in the coming weeks to deal with intensified Russian attacks.
- The US government immediately imposed a 17% tariff on Monday over most of the imports of fresh tomatoes in Mexico after negotiations ended without an agreement to avoid the tariff. Trump announced, on Saturday, a 30% tariff on imports from the European Union (EU) and Mexico as of August 1. He also proposed a general tariff rate of 15%-20%on other commercial partners, an increase with respect to the current base rate of 10%. In response, the European Union announced on Sunday that it will extend its pause in retaliation measures against US tariffs until early August, hoping to reach a negotiated agreement.
- The US government registered a budget surplus of 27,000 million dollars in June, promoted by an increase in customs rights revenue, which reached a record of 27.2 billion dollars. This increase in tariff collection, which comes largely from policies introduced during the Trump administration, contributed to a 13% increase in total budget revenues, which amounted to 526,000 million dollars. Meanwhile, federal expenditure decreased 7% to 499,000 million dollars.
- The Chinese economy expanded at an annual rate of 5.2% 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, compared to the market consensus of an increase of 0.9%. 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 National Statistics Office (NBS) shared its economic perspective during its press conference, stating that the general economic performance in the first half of the year was stable, with constant progress. However, he emphasized the need to improve the investment structure and the environment. He also added that the real estate market is directed towards stabilization.
The Australian dollar bounces to the nine -day Ema about 0.6550
The Aud/USD pair is negotiating around 0.6530 on Wednesday. The technical analysis of the daily graphic indicated a persistent bullish feeling, since the pair is positioned within the ascending channel pattern. The 14 -day relative force (RSI) index is maintained around the 50th brand, suggesting that market bias is neutral. However, the pair moved below the nine -day exponential (EMA) mobile average, indicating that the impulse of the short -term price is weakening.
On the positive side, the aud/USD torque could try the nine -day EMA at 0.6541. 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. Additional advances would strengthen the bullish bias and would lead the region around the upper limit of the upward channel about 0.6700.
The AUD/USD torque is testing the lower limit of the upward channel around 0.6510. A rupture below the channel would weaken the impulse of the short -term price and put pressure down the torque to navigate in the area around the 50 -day EMA in 0.6488, aligned with the minimum of three weeks at 0.6485.
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 Swiss Franco.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.10% | -0.09% | -0.03% | -0.06% | -0.18% | -0.04% | -0.02% | |
| EUR | 0.10% | 0.02% | 0.05% | 0.04% | -0.12% | 0.00% | 0.10% | |
| GBP | 0.09% | -0.02% | 0.06% | 0.06% | -0.13% | -0.01% | 0.08% | |
| JPY | 0.03% | -0.05% | -0.06% | -0.04% | -0.11% | -0.04% | 0.06% | |
| CAD | 0.06% | -0.04% | -0.06% | 0.04% | -0.13% | -0.09% | 0.05% | |
| Aud | 0.18% | 0.12% | 0.13% | 0.11% | 0.13% | 0.11% | 0.20% | |
| NZD | 0.04% | -0.01% | 0.01% | 0.04% | 0.09% | -0.11% | 0.09% | |
| CHF | 0.02% | -0.10% | -0.08% | -0.06% | -0.05% | -0.20% | -0.09% |
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 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.
