- The US dollar is strengthened as commercial conversations between the US and China advance.
- Copper production in China expands as the national supply satisfies demand.
- The PBOC continues to reduce its gold purchases amid the price increase.
- The Fed is expected to maintain stable rates at 4.25% -4.50% until mid-2025.
The Australian dollar (aud) faces down pressure as global commercial dynamics change, particularly between the United States (USA) and China. Despite the signs of a stronger copper production in China, trade agreements and Federal Reserve Policies (FED) continue to mold the feeling of investors, with the Fed expecting them to keep the stable rates over the coming months.
Daily summary of market movements: The USD shoots as the commercial war cools
- The US dollar gains ground as the DXY approaches key levels of resistance after the news of a 90 -day tariff break between the US and China.
- The production of copper in China shows signs of expansion, relieving concerns about the shortage of global supply.
- The Popular Bank of China (PBOC) reduced its gold purchases, marking the lowest purchase activity in months.
- The Fed position on monetary policy remains firm, without expected rate cuts until the end of 2025.
- The Australian dollar fights against a strong US dollar while markets digest the impact of commercial conversations and Fed policy.
- The market is increasingly valuing a prolonged period of rates cuts by the Fed, starting as soon as in September 2025.
- Copper mineral imports in China reached record levels, pointing out a robust national production.
- PBOC’s gold reserves saw a small increase, although the purchase rhythm has decreased.
- The US dollar remains supported by strong yields of the treasure, particularly as the 10 -year yield reaches 4.45%.
- Raw material markets are experiencing mixed signals, with gold prices weakening while the crude WTI shows signs of recovery.
- Global economic prospects are in flow, with many analysts waiting for a slowdown due to ongoing commercial uncertainties.
- As commercial tensions are relieved, the Aud benefits from a reduced risk premium, but remains under pressure against the US dollar.
Technical analysis: The bear knocks on the door
The Aud/USD torque is showing a bassist impulse, currently quoting around 0.6370, lowering approximately 0.66% in the day. The relative force index (RSI) is neutral, oscillating in the 50s, while the MACD suggests a sales signal. The short -term mobile socks, including the simple mobile socks (SMA) of 20 days and 200 days, indicate sales pressure, while the 100 -day SMA indicates a possible purchase. The key support levels are found at 0.6366, 0.6352 and 0.6344, with resistance at 0.6387, 0.6392 and 0.6395. The technical perspective remains negative, particularly with the recent drop in raw material prices and the strength of the US dollar.
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.
