Daily Price Outlook
The Australian Dollar (AUD) edged higher on Tuesday after the Reserve Bank of Australia (RBA) held the Official Cash Rate at 4.10% during its April policy meeting—an outcome widely expected by markets.
In the post-meeting statement, the RBA struck a cautious tone, emphasizing ongoing concerns about the persistence of inflation and heightened geopolitical tensions.
The central bank acknowledged that recent U.S. tariff rhetoric is weighing on global business confidence and contributing to an increasingly uncertain trade environment.
Governor Michele Bullock reinforced the board’s cautious stance, noting that policymakers are not yet prepared to discuss rate cuts. “We have to be careful not to get ahead of ourselves on policy,” she said, confirming that no firm decisions were made regarding a May move. The RBA’s wait-and-see approach comes as inflation data remains sticky, and global risk sentiment stays fragile.
China Data and U.S. Tariff Uncertainty Shape Sentiment
While the RBA decision offered short-term support for the Aussie, global trade risks continue to act as a limiting factor.
Market participants remain wary ahead of U.S. President Donald Trump’s reciprocal tariff announcement on Wednesday, which he confirmed would apply to all countries—not just key trading partners.
Such policies could dampen risk sentiment and, by extension, weigh on the AUD, given its sensitivity to global trade flows.
On a more supportive note, economic data from China—Australia’s largest trading partner—surprised to the upside.
China’s Caixin Manufacturing PMI rose to 51.2 in March, while the NBS Manufacturing and Non-Manufacturing PMIs also posted solid gains, offering signs of stabilization in China’s economic activity.
This data provided a modest tailwind for the Aussie, signaling potential demand strength in regional trade.
Mixed Domestic Data Keeps RBA Cautious
Domestically, February retail sales rose 0.2% month-over-month, falling short of market expectations for a 0.3% gain and down from January’s 0.3% increase.
While not alarming, the miss underscores tepid consumer momentum, which could keep the RBA on the sidelines in the near term.
Looking ahead, traders will closely watch U.S. ISM Manufacturing PMI data later today for further direction in AUD/USD.
Until then, the Aussie remains supported near term, but upside potential could remain capped by global uncertainty.
AUD/USD – Technical Analysis
The Australian Dollar remains under sustained selling pressure, with AUD/USD extending its downside drift below the 50-period simple moving average and clinging to the lower bounds of a descending trend channel.
After failing to sustain gains above the $0.6290 region, price broke below the key $0.6289 SMA and is now positioned precariously near short-term support at $0.6250. The inability to retake the upper trendline or the moving average reflects persistent bearish sentiment.
The recent rejection from the $0.6330 resistance—coupled with the channel breakdown—points to an increasing probability of continuation toward the next key horizontal support at $0.6217.
Momentum indicators reinforce the bearish outlook: the RSI is hovering at 41.30, below the midline and signaling weak upside momentum, while the price remains capped under a firm downtrend line that has held since March 19.
A confirmed breach below $0.6250 could accelerate losses toward the $0.6218 and $0.6188 support levels. Meanwhile, resistance continues to stack at $0.6291 and $0.6330, with any rebounds likely to be short-lived unless the pair closes decisively above the falling trendline and 50-SMA.
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