AUD/USD Price Analysis – March 27, 2025
Daily Price Outlook
During the Asian trading session, the AUD/USD currency pair experienced notable weakness, falling to a low of 0.6615. This decline was primarily driven by fresh concerns over US auto tariffs, a more cautious outlook from the Federal Reserve, and the anticipation of Chinese economic stimulus.
However, the Australian Dollar (AUD) managed to find some support, aided by Australia's strong trade relationships and commodity exports. Now, the AUD/USD pair has rebounded, reaching an intra-day high of 0.6319, successfully recovering its earlier losses.
US Auto Tariffs Escalate Trade Tensions, Weigh on Market Sentiment
The AUD/USD pair came under pressure after President Donald Trump’s announcement of a 25% tariff on auto imports, set to take effect on April 2.
This move has raised concerns about escalating global trade tensions, with investors worried about the potential economic impact of the tariffs.
Additionally, Trump suggested the possibility of imposing tariffs on copper imports. While this could benefit Australia’s copper-exporting economy, it also added to the overall uncertainty in global markets.
Despite the tariff concerns, the market received some relief when Trump offered a one-month reprieve for auto parts imports. However, these ongoing tariff disputes continued to overshadow the AUD’s ability to gain strength.
Fed Policy Uncertainty and Impact on the USD
On the US front, the US Dollar Index (DXY) retreated from its recent highs, trading around 104.50 as market participants digested the latest economic data.
US Treasury yields, which had been providing support to the USD, showed signs of easing, with the 2-year and 10-year yields hovering at 4.0% and 4.34%, respectively. These declines were compounded by the growing uncertainty surrounding US Federal Reserve policy.
St. Louis Fed President Alberto Musalem and Minneapolis Fed President Neel Kashkari both spoke about the challenges the Fed faces in managing inflation.
Kashkari highlighted that there is still more to be done. The uncertainty about the Fed's future decisions, combined with market concerns about an economic slowdown due to trade tensions, put pressure on the US Dollar. As a result, the Australian Dollar (AUD) gained some strength.
Chinese Stimulus and Australian Inflation Data Support AUD Amid Cautious Outlook
On the other hand, expectations of Chinese stimulus helped support the Australian Dollar (AUD), thanks to the strong trade ties between Australia and China.
The Chinese government's plans to boost consumption by raising wages and easing financial burdens are seen as positive for Australia's export-driven economy.
This stimulus could improve consumer confidence in China, which is a key trading partner for Australia, and help increase demand for Australian commodities.
At the same time, Australia’s Monthly Consumer Price Index (CPI) for February showed a slight dip to 2.4%, which was below expectations but still reflected a stable inflation environment.
This muted inflation figure, coupled with the Reserve Bank of Australia’s (RBA) decision to maintain interest rates steady, added to the cautious outlook for the Australian Dollar.
GOLD (XAU/USD) – Technical Analysis
The Australian dollar is inching higher against the U.S. dollar, currently trading at $0.63157, as the pair holds above its key pivot point at $0.62948.
This level also aligns closely with the 50-period Exponential Moving Average (EMA) at $0.62945, reinforcing short-term technical support and signaling a modestly bullish tone.
Immediate resistance is seen at $0.63304. A sustained break above this threshold could set the stage for a rally toward $0.63587, followed by a key ceiling at $0.63907—levels that have capped upside moves in previous sessions.
However, buyers will need continued momentum to push through these levels, especially with broader risk sentiment in flux.
On the downside, immediate support sits at $0.62580. A drop below this could open a path to $0.62306 and $0.62060, where buying interest may re-emerge.
These levels should be watched closely in the event of a sentiment shift or stronger-than-expected U.S. economic data later this week.
Technically, the structure favors a long bias above $0.62947, with a short-term target of $0.63426 and a stop loss set at $0.62692 to manage risk.
The pair continues to consolidate within a modest upward channel, supported by the 50 EMA, suggesting underlying demand remains intact.
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AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- AUD/USD holds above $0.62945 EMA and pivot, signaling short-term bullish bias.
- Key resistance levels lie at $0.63304, $0.63587, and $0.63907.
- Support at $0.62580 and below may limit downside in case of reversal.
The Australian dollar is inching higher against the U.S. dollar, currently trading at $0.63157, as the pair holds above its key pivot point at $0.62948.
This level also aligns closely with the 50-period Exponential Moving Average (EMA) at $0.62945, reinforcing short-term technical support and signaling a modestly bullish tone.
Immediate resistance is seen at $0.63304. A sustained break above this threshold could set the stage for a rally toward $0.63587, followed by a key ceiling at $0.63907—levels that have capped upside moves in previous sessions.
However, buyers will need continued momentum to push through these levels, especially with broader risk sentiment in flux.
On the downside, immediate support sits at $0.62580. A drop below this could open a path to $0.62306 and $0.62060, where buying interest may re-emerge.
These levels should be watched closely in the event of a sentiment shift or stronger-than-expected U.S. economic data later this week.
Technically, the structure favors a long bias above $0.62947, with a short-term target of $0.63426 and a stop loss set at $0.62692 to manage risk.
The pair continues to consolidate within a modest upward channel, supported by the 50 EMA, suggesting underlying demand remains intact.
AUD/USD - Trade Ideas
Entry Price – Buy Above 0.62947
Take Profit – 0.63426
Stop Loss – 0.62692
Risk to Reward – 1: 1.8
Profit & Loss Per Standard Lot = +$479/ -$255
Profit & Loss Per Mini Lot = +$47/ -$25
AUD/USD Price Analysis – March 25, 2025
Daily Price Outlook
During the European trading session, the AUD/USD currency pair remained steady, trading around 0.6319, with an intra-day high of 0.6323.
Despite some underlying challenges, the Australian Dollar (AUD) has been supported by expectations of a cautious approach from the Reserve Bank of Australia (RBA), along with the anticipation of continued Chinese stimulus to boost the Australian economy.
However, the pair faces some challenges from growing concerns over the Australian government's budget deficit and the potential impact of US trade policies.
Australia's Budget Deficit and Economic Outlook
The Australian economy faces a rising budget deficit, with the Treasury projecting a deficit of A$27.6 billion for 2024-25, widening to A$42.1 billion in 2025-26. Despite this, Australia's GDP growth is expected to stabilize at 2.25% in fiscal 2026 and 2.5% in fiscal 2027.
The Australian Treasurer, Jim Chalmers, also announced new tax cuts totaling approximately A$17.1 billion, aimed at garnering political support ahead of upcoming elections.
While these measures could support domestic consumption, the growing budget deficit raises concerns about fiscal sustainability and may limit the Australian government's ability to respond to future economic challenges.
Investors are also looking ahead to the RBA's decisions, with many speculating that the central bank will keep interest rates unchanged in April after its first rate cut in four years in February.
Moreover, the Australian economy continues to benefit from its strong trade ties with China, particularly as Chinese policymakers implement measures to stimulate domestic consumption and revitalize their economy.
US Dollar Strengthened by Services PMI Surge
On the US front, the US dollar strengthened amid a surge in the Services PMI, which climbed to 54.3 in March from 51.0 in February, signaling a robust rebound in business activity. The increase in the Services PMI marked a three-month high, further indicating economic resilience despite mixed signals from other sectors.
Meanwhile, the S&P Global US Composite PMI also rose to 53.5, up from February's 51.6, highlighting continued expansion in the economy. However, the US manufacturing sector experienced a slowdown, with the Manufacturing PMI dropping to 49.8, falling short of market expectations.
The US Dollar Index (DXY) has remained stable around 104.30, buoyed by these positive services sector data. While inflation remains a concern for the Federal Reserve, the hawkish stance of Fed Chair Jerome Powell, who noted that inflation is moving closer to the 2% target, has provided support for the USD.
Therefore, the stronger US dollar, driven by robust services sector data and Fed's hawkish stance, likely puts downward pressure on the AUD/USD pair, as the USD outperforms the AUD.
Geopolitical Risks and US Trade Policies Impact on AUD/USD
Despite positive data from both the US and Australia, the AUD/USD pair faces risks due to uncertainty around US trade policies. US President Trump's upcoming tariff announcement in early April could affect global trade and economic growth. Although Trump suggested some countries might be exempt from the tariffs, the full details of the plan are still unclear, leaving traders cautious.
Additionally, there are concerns that the US economy could slow down due to trade tensions and the impact of tariffs on key industries like agriculture and coal. These factors could add volatility to the AUD/USD pair, as traders weigh the strong US Dollar against the potential risks to Australia's economy.
AUD/USD – Technical Analysis
The Australian Dollar (AUD/USD) is treading water around $0.62861 in Tuesday’s early European session, showing little change on the day.
Despite the neutral tone, price action is gradually aligning with a short-term bullish bias, underpinned by support above the pivot point at $0.62679.
The 4-hour chart reveals consolidation just beneath the 50-period EMA at $0.63170—a level that’s currently acting as a dynamic resistance ceiling.
A decisive move above $0.63172, the immediate resistance level, would confirm bullish control and could open the door toward the next upside targets at $0.63510 and $0.63907.
These levels coincide with recent supply zones, where sellers have historically emerged. Sustained momentum above the 50-EMA could also suggest that buyers are preparing for a broader recovery leg.
On the downside, immediate support is located at $0.62342, followed by $0.61966 and the deeper floor at $0.61599.
A break below $0.62679 would negate the bullish setup and increase the risk of a slide toward those lower supports.
The broader context remains mixed, with AUD/USD reacting to shifting U.S. rate expectations, commodity sentiment, and Asia-Pacific macro data.
For now, the technicals suggest cautious optimism, but confirmation above $0.63172 is needed before bulls can fully commit to higher targets.
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AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- AUD/USD trades just above pivot point at $0.62679, suggesting near-term support.
- A breakout above $0.63172 may trigger upside toward $0.63510 and $0.63907.
- Breakdown below $0.62679 could shift momentum toward $0.62342 and $0.61966.
The Australian Dollar (AUD/USD) is treading water around $0.62861 in Tuesday’s early European session, showing little change on the day.
Despite the neutral tone, price action is gradually aligning with a short-term bullish bias, underpinned by support above the pivot point at $0.62679.
The 4-hour chart reveals consolidation just beneath the 50-period EMA at $0.63170—a level that’s currently acting as a dynamic resistance ceiling.
A decisive move above $0.63172, the immediate resistance level, would confirm bullish control and could open the door toward the next upside targets at $0.63510 and $0.63907.
These levels coincide with recent supply zones, where sellers have historically emerged. Sustained momentum above the 50-EMA could also suggest that buyers are preparing for a broader recovery leg.
On the downside, immediate support is located at $0.62342, followed by $0.61966 and the deeper floor at $0.61599.
A break below $0.62679 would negate the bullish setup and increase the risk of a slide toward those lower supports.
The broader context remains mixed, with AUD/USD reacting to shifting U.S. rate expectations, commodity sentiment, and Asia-Pacific macro data.
For now, the technicals suggest cautious optimism, but confirmation above $0.63172 is needed before bulls can fully commit to higher targets.
AUD/USD - Trade Ideas
Entry Price – Buy Above 0.62679
Take Profit – 0.63181
Stop Loss – 0.62424
Risk to Reward – 1: 1.9
Profit & Loss Per Standard Lot = +$502/ -$255
Profit & Loss Per Mini Lot = +$50/ -$25
AUD/USD Price Analysis – March 20, 2025
Daily Price Outlook
During the European trading session, the AUD/USD currency pair experienced strong bearish pressure, trading near the 0.6285 level as the Australian Dollar weakened against the US Dollar. This decline was largely attributed to disappointing domestic employment data and the continued strength of the US Dollar.
Australia's February Employment Report Shows Sharp Job Losses, Weighing on AUD
On the data front, the Australia's employment report for February revealed a sharp drop in jobs, with the Employment Change showing a loss of 52.8K jobs, compared to the expected 30.0K increase.
This was a stark contrast to the 30.5K rise reported in January (revised from 44K), highlighting a concerning slowdown in the labor market.
The Australian Unemployment Rate held steady at 4.1%, in line with market expectations, but the weaker-than-expected job growth weighed heavily on market sentiment, driving the AUD lower.
US Dollar Strengthened by Hawkish Fed Remarks and Geopolitical Tensions Weighing on AUD/USD
Meanwhile, the US dollar found strength from hawkish remarks made by Federal Reserve Chair Jerome Powell, who emphasized that the labor market remains strong and inflation is moving closer to the Fed's target, though it remains elevated. This reaffirmed expectations of further tightening, which helped maintain the USD's bullish momentum.
On the geopolitical front, global trade tensions also contributed to the market's cautious tone. Former US President Donald Trump’s ongoing tariff threats, including reciprocal tariffs and plans to impose fees on Chinese-linked vessels, have raised concerns over potential disruptions to global trade.
Moreover, Trump's ongoing trade disputes with China are creating further uncertainty in the markets, weighing on the Aussie Dollar.
In addition, the temporary agreement between President Trump and Russian President Vladimir Putin to pause strikes targeting energy infrastructure in Ukraine failed to quell broader concerns over the conflict, further adding to the risk-averse sentiment in the markets. These geopolitical factors further pressured the AUD/USD pair, limiting any potential upside.
AUD/USD – Technical Analysis
The Australian dollar (AUD/USD) is trading at $0.6317, up 0.03%, as it attempts to recover from recent declines. However, the pair remains below the key pivot level of $0.6332, suggesting that bearish pressure persists.
The 50-day Exponential Moving Average (EMA) at $0.6347 is acting as a dynamic resistance level, keeping the pair in a downward trajectory.
If AUD/USD fails to break above this level, it could face renewed selling pressure, with immediate support at $0.6298. A break below this level could open the door for further losses toward $0.6277 and $0.6258.
On the upside, resistance at $0.6363 remains a key hurdle for bulls. If AUD/USD manages to break above this level, further gains toward $0.6390 and $0.6415 could follow. However, with the broader trend favoring the U.S. dollar due to Federal Reserve policy expectations, any upside moves may be short-lived.
A break below $0.6332 is likely to reinforce a bearish trend, with a downside target at $0.6298. Traders should watch for a break above $0.6363 to confirm a potential shift in momentum.
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AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- AUD/USD remains bearish below $0.6332, with downside targets at $0.6298 and $0.6277.
- The 50-day EMA at $0.6347 is acting as a strong resistance level.
- A break above $0.6363 could signal a potential reversal, targeting $0.6390.
The Australian dollar (AUD/USD) is trading at $0.6317, up 0.03%, as it attempts to recover from recent declines. However, the pair remains below the key pivot level of $0.6332, suggesting that bearish pressure persists.
The 50-day Exponential Moving Average (EMA) at $0.6347 is acting as a dynamic resistance level, keeping the pair in a downward trajectory.
If AUD/USD fails to break above this level, it could face renewed selling pressure, with immediate support at $0.6298. A break below this level could open the door for further losses toward $0.6277 and $0.6258.
On the upside, resistance at $0.6363 remains a key hurdle for bulls. If AUD/USD manages to break above this level, further gains toward $0.6390 and $0.6415 could follow. However, with the broader trend favoring the U.S. dollar due to Federal Reserve policy expectations, any upside moves may be short-lived.
A break below $0.6332 is likely to reinforce a bearish trend, with a downside target at $0.6298. Traders should watch for a break above $0.6363 to confirm a potential shift in momentum.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.63320
Take Profit – 0.62979
Stop Loss – 0.63594
Risk to Reward – 1: 1.24
Profit & Loss Per Standard Lot = +$341/ -$274
Profit & Loss Per Mini Lot = +$34/ -$27
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- AUD/USD remains bearish below $0.63844, with sellers controlling short-term price action.
- Immediate support at $0.63573—a break below could push the pair toward $0.63402 and $0.63266.
- Upside remains limited unless $0.64000 is breached, with resistance levels capping further gains.
The AUD/USD pair is trading at $0.63698, showing slight downward movement as it struggles to maintain bullish momentum.
The price remains below the pivot point at $0.63844, indicating that sellers still have control in the short term. With the 50-day EMA at $0.63137, the broader trend suggests a cautious outlook, with potential for further downside if key support levels fail to hold.
Immediate resistance stands at $0.64000, with additional hurdles at $0.64121 and $0.64260. A breakout above these levels could signal renewed buying interest, pushing the pair toward a short-term recovery. However, without a fundamental catalyst, upside movement appears limited.
On the downside, immediate support at $0.63573 remains critical. A break below this level could lead to a test of $0.63402, followed by $0.63266, reinforcing the bearish sentiment.
A break below $0.6384 could accelerate downside momentum, making $0.63540 a viable target for short sellers. Conversely, a move above $0.64000 may shift sentiment toward a temporary bullish correction.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.63842
Take Profit – 0.63540
Stop Loss – 0.63998
Risk to Reward – 1: 1.9
Profit & Loss Per Standard Lot = +$302/ -$156
Profit & Loss Per Mini Lot = +$30/ -$15
AUD/USD Price Analysis – March 18, 2025
Daily Price Outlook
During the European trading session, the AUD/USD pair remained sluggish around the 0.6371 level as the US dollar regained strength.
However, the greenback recovered from recent losses amid escalating geopolitical tensions in the Middle East. The US reaffirmed its stance on striking Yemen’s Houthis until they halt attacks on Red Sea shipping, further unsettling markets.
Moreover, US President Joe Biden warned Iran of consequences if it continued supporting the Houthi group in Yemen. The situation has fueled risk aversion, leading to a stronger US Dollar and pressuring the Aussie.
Despite this, the AUD/USD saw some support due to the China’s latest economic stimulus measures. Moreover, the US dollar could lose traction due to rising trade tensions and growing economic concerns in the US. The market remains cautious as investors assess the Federal Reserve’s policy stance and economic data.
AUD Faces Pressure from RBA Caution and US Trade Policies
On the AUD front, the Reserve Bank of Australia (RBA) remains cautious about rate cuts. RBA Assistant Governor Sarah Hunter said the bank is taking a careful approach to easing rates.
The February policy statement also showed this cautious stance, which is different from market expectations of big rate cuts. Hunter added that US policy decisions, especially on inflation, could affect Australia.
Further pressure on the Aussie came as President Biden reaffirmed plans to impose reciprocal and sectoral tariffs, specifically targeting steel and aluminum imports.
Biden ruled out exemptions, signaling tough trade measures that could impact Australian exports. Australian Prime Minister Anthony Albanese confirmed that Australia would not impose retaliatory tariffs, aiming to avoid inflationary effects on domestic consumers.
Therefore, the cautious stance of the RBA and trade tensions with the US could weigh on the AUD, leading to potential weakness in the AUD/USD pair, as market sentiment remains uncertain.
Chinese Economic Support Provides Some Relief to the AUD
On the other side, the Australian Dollar found some support from China’s latest economic stimulus measures. China recently introduced a special action plan to boost consumption, aiming to enhance market sentiment.
The plan includes wage increases, measures to encourage household spending, and efforts to stabilize stock and real estate markets.
China’s retail sales data showed a 4.0% year-over-year increase in January-February, improving from December’s 3.7% rise.
Meanwhile, industrial production rose by 5.9% YoY, surpassing the 5.3% forecast but slightly lower than the previous reading of 6.2%. These indicators suggest steady growth in China, which could help cushion the AUD/USD pair from further downside.
Weak US Data and Consumer Confidence Pressure the US Dollar
On the US front, the broad-based US Dollar Index (DXY) hovered around 103.50, struggling due to weak US economic data and uncertainty surrounding Biden’s tariff threats. US Retail Sales figures for February increased by just 0.2%, falling short of the expected 0.7% gain.
January’s data was also revised lower to -1.2% from -0.9%, signaling weaker consumer spending and raising concerns about a potential economic slowdown.
Moreover, the University of Michigan’s Consumer Sentiment Index fell to 57.9 in March, marking its lowest level since November 2022.
The decline in consumer confidence further pressured the US Dollar. However, the Fed is expected to maintain its current policy stance, with markets awaiting the outcome of its two-day meeting.
Therefore, weak US data and declining consumer confidence weighed on the USD, limiting its strength. This could support the AUD/USD pair, but RBA caution and trade tensions may cap significant gains.
AUD/USD – Technical Analysis
The AUD/USD pair is trading at $0.63698, showing slight downward movement as it struggles to maintain bullish momentum.
The price remains below the pivot point at $0.63844, indicating that sellers still have control in the short term. With the 50-day EMA at $0.63137, the broader trend suggests a cautious outlook, with potential for further downside if key support levels fail to hold.
Immediate resistance stands at $0.64000, with additional hurdles at $0.64121 and $0.64260. A breakout above these levels could signal renewed buying interest, pushing the pair toward a short-term recovery. However, without a fundamental catalyst, upside movement appears limited.
On the downside, immediate support at $0.63573 remains critical. A break below this level could lead to a test of $0.63402, followed by $0.63266, reinforcing the bearish sentiment.
A break below $0.6384 could accelerate downside momentum, making $0.63540 a viable target for short sellers. Conversely, a move above $0.64000 may shift sentiment toward a temporary bullish correction.
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AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- AUD/USD remains bearish below $0.6309, with sellers eyeing support at $0.6268 and $0.6233.
- The 50-day EMA at $0.6298 is capping upside moves, reinforcing near-term bearish sentiment.
- A breakout above $0.6355 could shift momentum, potentially targeting $0.6383 and higher levels.
The Australian dollar is struggling to gain momentum, with AUD/USD trading at $0.6296, down marginally as traders assess shifting market sentiment. The pair remains under pressure below its pivot point at $0.6327, signaling potential downside risks in the near term. Despite attempts at recovery, the 50-day EMA at $0.6298 is acting as a dynamic resistance level, keeping a lid on bullish attempts.
If AUD/USD remains below $0.6327, sellers could push the pair toward immediate support at $0.6268, with a break lower exposing $0.6233 and $0.6198 as next downside targets. However, should buyers regain control, resistance stands at $0.6355, followed by $0.6383 and $0.6407, which will need to be cleared for a shift in momentum.
Macroeconomic factors, including expectations of Federal Reserve rate cuts and risk sentiment in global markets, will play a crucial role in the Aussie dollar’s direction. The Reserve Bank of Australia’s stance on monetary policy also remains in focus, with any hawkish signals potentially providing support to the currency.
For now, AUD/USD remains bearish below $0.6309, with sellers targeting key support levels. A sustained move below $0.6268 could accelerate losses, while a break above resistance at $0.6355 would indicate a potential reversal.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.63096
Take Profit – 0.62674
Stop Loss – 0.63383
Risk to Reward – 1: 1.4
Profit & Loss Per Standard Lot = +$422/ -$287
Profit & Loss Per Mini Lot = +$42/ -$28
AUD/USD Price Analysis – March 13, 2025
Daily Price Outlook
During the European trading session, the AUD/USD currency pair failed to stop its downward trend and extended its losses for the third consecutive session around $0.6285 on Thursday.
However, the pair found some support as the US Dollar (USD) remained under pressure due to uncertainty surrounding US tariffs and growing concerns over a potential recession.
Despite this, the Australian Dollar (AUD) struggled to gain traction following a sharp drop in Australia’s Consumer Inflation Expectations and rising global trade tensions, which weighed on market sentiment.
AUD/USD Pressured by Trade Disputes and Weak Inflation Expectations
The Australian Dollar came under fresh selling pressure after US President Donald Trump confirmed that Australia would not be exempt from the 25% tariffs on aluminum and steel. This decision heightened trade concerns and weighed on market sentiment.
At the same time, Australia’s Consumer Inflation Expectations dropped sharply to 3.6% in March from 4.6% in February, the lowest level since April 2024. This unexpected decline raised concerns about inflation in Australia, making it harder for the AUD to recover.
Adding to the pressure, Australian Prime Minister Anthony Albanese confirmed that Australia would not respond with its own tariffs against the US.He explained that retaliatory measures would only raise costs for Australian consumers and push inflation even higher.
This decision left the Australian Dollar more exposed to trade uncertainties, adding to its weakness in the market.
US Dollar Remains Subdued Amid Fed Rate Cut Speculation
On the US front, the broad-based US Dollar struggled as the US Dollar Index (DXY) hovered around 103.50. Traders analyzed the latest Consumer Price Index (CPI) data, which showed that inflation slowed in February.
The report increased expectations that the Federal Reserve (Fed) could cut interest rates sooner than expected. Monthly headline inflation dropped to 0.2% in February from 0.5% in January, while core inflation also eased to 0.2%, missing the expected 0.3%. The weaker inflation numbers reduced demand for the US Dollar, providing some support to the AUD/USD pair.
However, market sentiment turned negative after the European Union (EU) responded to US tariffs with its own measures. The US had imposed a 25% levy on European steel and aluminum, and in retaliation, the EU announced tariffs on $26 billion worth of US goods.
This move added to global trade uncertainty. At the same time, trade tensions between the US and China remained unresolved, with reports indicating that negotiations between the two countries had stalled, further weighing on market confidence.
RBA Policy Outlook and Market Focus on Key US Data
Investors are keeping a close eye on the Reserve Bank of Australia (RBA) and its policy outlook, especially after recent economic data reduced expectations for more rate cuts.
Australia’s economy showed unexpected strength, with growth surpassing forecasts and picking up for the first time in over a year.
However, the RBA remains cautious, as global trade uncertainties and weakening consumer confidence could still influence future policy decisions.
Looking ahead, traders are focused on Thursday’s US Producer Price Index (PPI) data and weekly jobless claims. These reports could offer new clues about the US economy and impact the direction of the US Dollar.
If the data comes in stronger or weaker than expected, it may create market volatility and influence the AUD/USD pair in the short term.
AUD/USD – Technical Analysis
The Australian dollar is struggling to gain momentum, with AUD/USD trading at $0.6296, down marginally as traders assess shifting market sentiment.
The pair remains under pressure below its pivot point at $0.6327, signaling potential downside risks in the near term. Despite attempts at recovery, the 50-day EMA at $0.6298 is acting as a dynamic resistance level, keeping a lid on bullish attempts.
If AUD/USD remains below $0.6327, sellers could push the pair toward immediate support at $0.6268, with a break lower exposing $0.6233 and $0.6198 as next downside targets.
However, should buyers regain control, resistance stands at $0.6355, followed by $0.6383 and $0.6407, which will need to be cleared for a shift in momentum.
Macroeconomic factors, including expectations of Federal Reserve rate cuts and risk sentiment in global markets, will play a crucial role in the Aussie dollar’s direction.
The Reserve Bank of Australia’s stance on monetary policy also remains in focus, with any hawkish signals potentially providing support to the currency.
For now, AUD/USD remains bearish below $0.6309, with sellers targeting key support levels. A sustained move below $0.6268 could accelerate losses, while a break above resistance at $0.6355 would indicate a potential reversal.
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