- AUD/USD continues to face US-China trade negotiations.
- Beijing is unlikely to alleviate the tariffs in Switzerland before the upcoming talks in Switzerland, incitement to the market's uncertainty and weaken the risk mood.
- President Trump has announced a “large” trade transaction with the United Kingdom, although the main tariffs remain 10%.
The AUD/USD pair continues their loss in the third consecutive session, trading at the Friday Asian session near 0.6390. The Australian Dollar (AUD) is under pressure due to the suspended progress of US-China trade negotiations. Given Australia and China's close economic ties, any pressure on the Chinese economy tends to consider.
According to the global time – the US Embassy in the United States – Beijing is unlikely to reduce tariffs before the upcoming talks in Switzerland. This adds to the insecurity of the market and suppresses the risk mood.
In the United States (USA), President Donald Trump has accepted a strong attitude towards Chinese trade policy after appointing a new ambassador to Beijing. Although tariff liberation is discussed, the administration seems careful, Trump claimed that they “do not look for so many exceptions”.
At the same time, China is allegedly considering a significant change in its real estate market and promising to sell only completed real estate. This step aimed at stabilizing the real estate sector is part of the broader reform plan. The regulation would apply to future land sales, except for public housing and local governments would be implemented.
The US Dollar Ends (DXY), which measures the US dollar value (USD) to the currency basket, trades about 100.60, incited by strong US economic data and expectations for long -term yield differences. However, the initial optimism related to the US-UK trade agreement has faded as it turned out that the existing 10% tariffs remain in place.
Australian Dollar Fuck
One of the most important factors in the Australian Dollar (AUD) is the level of interest rates set by the Australian Reserve Bank (RBA). As Australia is a resource -rich country, the second key manager is the price of its largest export, iron ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as Australian inflation, its growth rate and trade balance. Market minds-investors accept more risky assets (risk-on) or are looking for safe Haven (risk-field) -s factor, which is a positive risk for AUD.
The Australian Reserve Bank (RBA) affects the Australian dollars (AUD), setting Australian banks to borrow to each other. This affects the level of interest rates for the entire economy. The main purpose of the RBA is to maintain a stable inflation rate of 2-3%by adjusting the interest rates up or down. Relatively high interest rates compared to other major central banks support AUD and the opposite relatively low. Quantitative alleviation and effort with the former AUD negative and another can also be used to influence the credit conditions.
China is the largest trading partner in Australia, so the health of the Chinese economy is a significant impact of the Australian dollar value (AUD). If the Chinese economy is doing well, it buys more raw materials, goods and services in Australia, raising the demand for AUD and pushing its value. The opposite is that the Chinese economy does not grow as fast as it was thought. Therefore, positive or negative surprises of Chinese growth data are often a direct impact on the Australian dollar and its couples.
Raudmaa ore is the largest export of Australia, which, according to the 2021 data, is $ 118 billion a year, which is the main destination of China. Therefore, the price of iron ore may be the Australian dollar leader. In general, AUD also rises the price of iron ore as the demand for all currency is increasing. The opposite is the case when the price of iron ore falls. Higher prices for iron ore also cause Australian positive trade balance, which is also positive for AUD.
A trade balance, which is a difference between what the state earns from its exports compared to what it pays for imports is another factor that can affect the value of the Australian dollar. If Australia produces highly coveted exports, it becomes a purely surplus demand from foreign buyers who want to buy their exports compared to what it spends to buy imports. Therefore, the positive net trade balance is strengthened by the AUD if the trade balance is negative.
