Forex Trading Tools and Services

AUD/USD Currencies

Australian Dollar Stabilizes Ahead of US NFP Amid Trade Optimism and Mixed Economic Signals

  • BY
  • August 1, 2025
  • 0 Comments

Australian Dollar (AUD) stabilized on Friday, ending its six-day decline as markets became cautious before the eagerly awaited US Nonfarm Payrolls (NFP) release. The currency was supported after President Trump left Australia off the list of countries subject to new US tariff increases, with a 10% baseline tariff being kept in place that would favor Australian exports. Better-than-expected domestic data, such as retail sales and building permits, offered additional insulation, in spite of lower-than-anticipated inflation and producer prices. Soft Chinese manufacturing numbers, however, topping Australia’s biggest trading partner, placed a cap on gains. Following traders’ expectations of US labor market data and continued global trade news, the AUD/USD pair is stuck in a range, trading around 0.6430. KEY LOOKOUTS • There is a wait for US jobs data, which may have an impact on the Fed’s rate perspective and be the driver of USD strength or weakness and hence AUD/USD volatility. • Australia’s exemption from US tariff increases favors AUD sentiment and makes exports to the US market more competitive. • Weak Chinese PMI data is a bear risk to the AUD because Australia has significant trade exposure to China. • AUD/USD is resisted at 0.6487 (9-day EMA) and supported at 0.6421; a break in either direction might decide the short-term trend. The Australian Dollar remained firm on Friday, buoyed by trade sentiment after the US confirmed that Australia would not be slapped with higher tariffs, maintaining its competitiveness advantage in the US market. Even with persistent vigor in the US Dollar and softer Chinese manufacturing figures, the Aussie gained little respite from improved-than-anticipated local retail sales and building approvals. Investors are still wary of the US Nonfarm Payrolls announcement, which may have a strong bearing on market sentiment and exchange rates. With divided economic indicators and geopolitical intrigue on the table, the AUD/USD pair continues to fluctuate around the 0.6430 level with scarce momentum in either direction. The Australian Dollar held firm at 0.6430 as market players waited for the US Nonfarm Payrolls data release. Encouragement was provided by firm Australian retail sales and relief from US tariff increases, though poor Chinese manufacturing data capped upside potential. • AUD/USD held firm at 0.6430, bringing an end to a six-day slide in cautious market sentiment. • Australia avoided new US tariffs, with a 10% baseline remaining, which is favorable for export competitiveness. • US Nonfarm Payrolls report is eagerly awaited, with the ability to influence USD strength and move AUD/USD. • Australia’s Retail Sales increased 1.2% MoM in June, coming in above consensus and reflecting strong consumer spending. • Building Permits increased 11.9% MoM, the best growth since May 2023. • China’s Caixin Manufacturing PMI fell to 49.5, indicating contraction and dampening AUD sentiment. •  Technical indicators are bearish, with AUD/USD below the 9-day EMA and RSI at less than 50. The Australian Dollar gained stability leading into the weekend as traders redirected attention to next week’s US Nonfarm Payrolls release. The currency received mild support from the United States’ move to leave baseline tariffs on Australian imports in place, continuing to provide exporters with access to the US market without other trade restrictions. Australia’s Trade Minister highlighted the benefit this confers on Australian goods, helping lift volumes of exports. Locally, the economy continued to demonstrate resilience, with retail sales increasing more than anticipated in June and building permits registering a strong revival, indicative of strengthened momentum in consumer spending and housing activity. AUD/USD DAILY PRICE CHART SOURCE: TradingView Nevertheless, external conditions remain threatening, specifically from China, Australia’s biggest trade partner. China’s Caixin and official PMI both reported weakening manufacturing conditions, emblematic of widespread economic woes. Although China’s government has pledged heightened fiscal stimulus to combat internal headwinds, the slowdown spells anxiety for Australia’s commodity-reliant economy. At the same time, global trade trends continue to be in sharp focus as the US executes new tariff agreements with other nations. The Australian Dollar is still responsive to such cross-border movement, as investors gauge how new policy and economic developments could affect the short-term outlook. TECHNICAL ANALYSIS AUD/USD pair still displays a bearish inclination, trading below important moving averages. The 14-day Relative Strength Index (RSI) is below the neutral 50 line, indicating poor momentum. The two are still trading below the 9-day Exponential Moving Average (EMA), which adds to the short-term bearish pressure. The nearest support is at 0.6421, two-month low, with a possible slide towards three-month low of 0.6372 if selling increases. On the other hand, the resistance is around the 9-day EMA at 0.6487 and the 50-day EMA at 0.6495, which must be broken for any indication of recovery. FORECAST Should the next US Nonfarm Payrolls release be weaker than anticipated, it might cause a pullback in the US Dollar and provide room for the Australian Dollar to rebound. A break above the 9-day EMA at 0.6487 might convince buyers to drive the pair towards the 50-day EMA at 0.6495. Additional bullish push may continue to drive the rally towards the 0.6625 level, which is the eight-month high, particularly if solid Australian economic data and improving global risk appetite are maintained. On the other hand, better-than-expected US labor market statistics can spur expectations for a tighter Federal Reserve monetary policy, which will support the US Dollar and bear down on the AUD/USD pair. A clear break below current immediate support at 0.6421 would set the stage for a more substantial drop to 0.6372, the three-month low. Further China’s economic indicators weakening or increased tensions in global trade could further depress AUD sentiment, having the pair in downward motion.

Read More
AUD/USD Currencies

Australian Dollar Stable as Market Mood Buoys, US ISM Manufacturing PMI at Center Stage

  • BY
  • July 1, 2025
  • 0 Comments

Australian Dollar (AUD) is stable versus US Dollar (USD) as better global risk appetite and encouraging Chinese factory data offset domestic economic worries. Market mood improved after reports indicated the US is tapering its expectations for trade negotiations, which dampened concerns of aggressive tariffs. Meanwhile, the US Dollar continues to deteriorate amid increasing uncertainty around Federal Reserve policy and increasing fiscal worries. The stronger-than-forecast Caixin Manufacturing PMI in China also boosted optimism about Australia’s export outlook, given the nations’ high level of trade dependence. Traders now look ahead to the next US ISM Manufacturing PMI data for further guidance. KEY LOOKOUTS • The June PMI is closely watched by traders, which may have an impact on Fed policy expectations and affect the direction of the USD. • Continued deterioration in inflation trends and conflicting cues from Fed officials remain a drag on the US Dollar. • The stronger-than-forecasted Caixin and NBS PMIs in China could underpin the AUD because of the solid trade relationship between the two countries. • AUD/USD is trading close to 0.6560 with major resistance at 0.6583 and support of about 0.6529, which is having an impact on short-term market momentum. Australian Dollar is continuing to hold firm against the US Dollar on the back of enhanced global risk appetite and better-than-forecast Chinese manufacturing figures. Optimism increased after news suggested the US would tone down its ambitious tariff ambitions, easing fears of a full-blown trade war. Although Australia’s local manufacturing PMI was weak, China’s rebound in Caixin PMI offset positively because of the close economic relationships between the nations. The US Dollar remains under downward pressure in the meantime with Federal Reserve policy uncertainty and increasing fiscal worries. With investors awaiting the release of the US ISM Manufacturing PMI later on, it may give new indication of the US economic environment and further drive AUD/USD dynamics. Australian Dollar stabilizes with better risk mood and higher Chinese manufacturing figures. Fiscal worries and Fed policy uncertainty hold back the US Dollar as major US ISM PMI data looms. • News that the US might seek phasing out tariffs in deals has alleviated trade war concerns, boosting overall market sentiment and propelling the Australian Dollar. • China’s Caixin Manufacturing PMI surged to 50.4 in June (48.3), indicating growth and firming up demand for Australian exports. • Australia’s S&P Global Manufacturing PMI fell to 50.6, its lowest output reading since February, moderating—but not reversing—AUD momentum. • Increasing unease regarding Federal Reserve rate cut timing and concerns about a $3.3 trillion US fiscal package continue the US Dollar’s losing streak. • Traders are presently laser focused on the June ISM report; a surprise either direction could dictate the next short term path for AUD/USD. • The pair is quoted around 0.6560 in an uptrending channel; major resistance is at 0.6583/0.6650, whereas support is at 0.6529 (9 day EMA) and 0.6490. • Divergent signals—from Kashkari’s call for two 2025 cuts to Powell’s caution on tariff driven inflation—keep policy expectations volatile, influencing USD sentiment and, by extension, AUD/USD moves. The Australian Dollar is holding firm as global market sentiment improves, largely driven by easing trade tensions and stronger economic signals from China. Reports the US might ease its stance on trade talks by looking for phased agreements boosted investor sentiment and diminished the immediate danger of severe tariffs. The news comes as a welcome relief to jumpy markets that have been spooked by the chronic ambiguities in global trade. Also, China’s Caixin Manufacturing PMI reported a significant bounce in June, indicating a possible improvement in industrial activity. With the close trade relationship that Australia shares with China, good Chinese data tends to reflect positively on both the Australian economy and the Australian dollar. AUD/USD DAILY PRICE CHART SOURCE: TradingView Concurrently, the US Dollar still weakens with increasing fears regarding the direction of Federal Reserve policy and America’s fiscal issues. As much as inflation is in focus, mixed statements among Fed officials have made uncertain the timing and size of possible interest rate reductions. Adding to the uncertainty is a broad tax and spending plan under consideration in the US Senate that would sharply accelerate the national debt. All these factors combined have undermined the US Dollar’s attractiveness, allowing the Australian Dollar space to regain and consolidate even with slightly weaker local manufacturing data. TECHNICAL ANALYSIS Australian Dollar continues to be underpinned by more favorable global market sentiment and supportive news from China despite some weakness in local numbers. Optimism in markets was further fueled after reports emerged that the US is set to embrace phased trade deals instead of aggressive tariff plans, which dampened geopolitical tensions. In addition, China’s better-than-forecast Caixin Manufacturing PMI supported optimism about regional economic stability, to the advantage of Australia since they have robust trade relations. In contrast, the US Dollar is weakened by increasing uncertainty surrounding Federal Reserve policy moves and rising concern about widening fiscal deficits, also serving to support the Australian Dollar’s strength. FORECAST The Australian Dollar may have further room for gains if there is continued improvement in world risk appetite and supportive Chinese economic statistics. Favorable news on US trade policy, specifically the change in trend towards phased tariffs agreements, could diminish geopolitical risk and improve investor sentiment. If future US economic data, including the ISM Manufacturing PMI, indicate softening growth, it could add to expectations for Federal Reserve rate reductions, which would put further bearish pressure on the US Dollar and push AUD/USD higher. Further evidence of solid Chinese manufacturing activity and steady Australian inflation rates would also be bullish for the Aussie. On the negative, the Australian Dollar can be put under pressure if local economic data, such as retail sales and employment figures, discourage in the next few weeks. Also, if the US ISM Manufacturing PMI is stronger than anticipated, it might briefly strengthen the US Dollar by dampening rate cut expectations. Political events, including heightened tensions between the US and China or doubts regarding Australia’s fiscal prospects, may also reduce investor

Read More