- The Australian dollar remains under pressure in the middle of expectations that the RBA will produce another price drop of 25 points in May.
- The Chinese Foreign Minister Wang Yi stressed that dialogue is essential to resolve American-Chinese trade tensions.
- The US dollar was struggling because of the weakened confidence of investors from Trump's unpredictable trade policies.
The Australian dollar (AUD) is down Tuesday after registering more than 0.50% of gains compared to the US Dollar (USD) during the previous session. The Aud / USD pair depreciated while the US dollar appreciates in the middle of the softening of global trade tensions.
US President Donald Trump reported the opening up to the reduction of Chinese prices, while Beijing exempted certain American goods from his 125%samples. This decision has fueled the hope that the prolonged trade war between the two largest economies in the world could fire. Chinese Foreign Minister Wang Yi said on Tuesday that making concessions and withdrawals would only embrace the intimidator, stressing that dialogue is essential to resolve differences.
President Trump said there was progress and that he spoke with Chinese President Xi Jinping. However, a spokesperson for the Chinese embassy firmly denied the current negotiations with the United States, declaring: “China and the United States have no consultation or negotiations on prices.” The spokesman urged Washington to “stop creating confusion”.
Merchants are now focusing their attention to Australia's next inflation report, which is expected to release on Wednesday, which could influence the expectations of the policy of Reserve Bank of Australia. The RBA should implement another price drop of 25 points in May while political decision -makers are preparing for potential repercussions of the newly imposed American tariffs.
The Australian dollar can recover because confidence in American assets is weakening
- The US dollar index (DXY), which measures the USD against six major currencies, is negotiated at around 99.00 at the time of writing the time of the editorial staff. However, the US dollar has faced challenges, as Trump’s unpredictable trade policies have shaken trust in American assets, which prompted investors to turn to shared currency as an alternative. Any new escalation in the American-Chinese trade war could exert additional pressure on the greenback.
- According to the Wall Street Journal, President Trump intends to reduce the impact of his car rates, ensuring that the tasks on foreign manufacturing cars are not compared with other rates and reducing samples from foreign parts used in automotive production.
- US Secretary of the Treasury, Scott Bessent, said on Monday that he had interacted with Chinese authorities last week but had not mentioned the prices. Bessent said that if the American government is in communication with China, it is up to Beijing to take the first step to facilitate the price dispute, given the commercial imbalance between the two countries.
- Reuters reported on Sunday that American agriculture secretary Brooke Rollins said that the Trump administration is organizing daily discussions with China about prices. Rollins stressed that discussions were underway and that the trade agreements with other countries were also “very close”.
- Michael Hart, president of the American Chamber of Commerce in China, pointed out that it was encouraging to see the United States and China examining the prices. Hart noted that if the exclusion lists for specific categories would have been underway, no official announcement or policy has yet been published. The Chinese Ministry of Commerce and the American Department of Commerce are currently collecting comments on the issue.
- Westpac has planned Thursday that the Reserve Bank of Australia (RBA) would reduce interest rates of 25 base points at its next May 20 meeting. The RBA has adopted a data-based approach during recent quarters, which makes it difficult to forecast its actions beyond the next meeting with confidence.
- The Chinese finance ministry said on Friday that global economic growth remains slow, prices and trade wars continuing to undermine economic and financial stability. The ministry has urged all parties to improve the international economic and financial system thanks to stronger multilateral cooperation, by Reuters.
The Australian dollar is negotiated nearly 0.6400 after declining levels close to four months
The Aud / USD pair is negotiated approximately 0.6420 Tuesday, the daily graphic indicating a bias bias. The pair remains above the exponential mobile average of nine days (EMA), while the relative force index of 14 days (RSI) remains well above the brand at 50, signaling a continuous rise.
Uplining, immediate resistance is located at the recent four -month level of 0.6439, recorded on April 22. A clear rupture above this level could open the door for a rally to the highest from five months to 0.6515.
The initial support is observed at the EMA of nine days of 0.6387, with a stronger support near the EMA from 50 days to 0.6312. A sustained movement below these levels would undermine the upward perspectives and could trigger deeper losses, putting the low point of March 2020 almost 0.5914.
AUD / USD: Daily graphic
Australian dollar price today
The table below shows the percentage of variation in the Australian dollar (AUD) compared to the main currencies listed today. The Australian dollar was the lowest compared to the US dollar.
| USD | Eur | GBP | Jpy | Goujat | Aud | Nzd | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.25% | 0.15% | 0.30% | 0.06% | 0.09% | 0.24% | 0.33% | |
| Eur | -0.25% | -0.07% | 0.02% | -0.17% | -0.14% | 0.01% | 0.10% | |
| GBP | -0.15% | 0.07% | 0.08% | -0.10% | -0.05% | 0.09% | 0.17% | |
| Jpy | -0.30% | -0.02% | -0.08% | -0.18% | -0.14% | -0.06% | 0.11% | |
| Goujat | -0.06% | 0.17% | 0.10% | 0.18% | 0.03% | 0.19% | 0.27% | |
| Aud | -0.09% | 0.14% | 0.05% | 0.14% | -0.03% | 0.16% | 0.23% | |
| Nzd | -0.24% | -0.01% | -0.09% | 0.06% | -0.19% | -0.16% | 0.08% | |
| CHF | -0.33% | -0.10% | -0.17% | -0.11% | -0.27% | -0.23% | -0.08% |
The thermal map shows the percentage of variations in the main currencies against each other. The basic currency is chosen in the left column, while the quotes motto is chosen in the upper row. For example, if you choose the Australian dollar of the left column and you move along the horizontal line to the US dollar, the percentage of variation displayed in the box will represent Aud (base) / USD (quote).
Australian dollar faq
One of the most important factors for the Australian dollar (AUD) is the level of interest rate set by the Bank of Australia (RBA) reserve. Because Australia is a country rich in resources, another key engine is the price of its greatest export, iron ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and its commercial balance. The feeling of the market – that investors have more risky assets (risk) or are looking for safety havens (risk) – is also a factor, with a positive risk for AUD.
The reserve bank of Australia (RBA) influences the Australian dollar (AUD) by fixing the level of interest rate that Australian banks can lend each other. This influences the level of interest rate in the economy as a whole. The main objective of the RBA is to maintain a stable inflation rate of 2 to 3% by adjusting increased or down interest rates. Relatively high interest rates compared to other large central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative softening and tightening to influence credit conditions, with the old Aud-Negative and the second positive audience.
China is the largest trading partner in Australia, the health of the Chinese economy therefore has a major influence on the value of the Australian dollar (AUD). When the Chinese economy is doing well, it buys more raw materials, Australian goods and services, to lift demand for the AUD and to raise its value. The reverse is the case when the Chinese economy does not develop as quickly as expected. Positive or negative surprises in Chinese growth data therefore often have a direct impact on the Australian dollar and its pairs.
The iron ore is the largest export in Australia, representing $ 118 billion per year according to 2021 data, China as the main destination. The price of the iron ore can therefore be an engine of the Australian dollar. Generally, if the price of the iron ore increases, the AUD also increases, as the overall demand for the currency increases. The opposite is the case if the price of the iron ore falls. Higher prices of iron ore also tend to lead to a greater probability of a positive commercial balance for Australia, which is also positive of the AUD.
The commercial balance, which is the difference between what a country earns its exports in relation to what it pays for its imports, is another factor that can influence the value of the Australian dollar. If Australia produces highly sought -after exports, its currency will gain only from the excess demand created from foreign buyers seeking to buy its exports in relation to what it spends to buy imports. Consequently, a positive net trade balance strengthens the AUD, with the opposite effect if the trade balance is negative.
