- The Australian dollar has been stable since the release of key economic data in the country.
- Australia's trade surplus rose to 5,620m in January, exceeding its forecast of 5,500m, improving from the previous 4,924m.
- Following changes in President Trump's tariff strategy, the US dollar remains restrained as risk sentiment improves.
The Australian Dollar (AUD) has held the property for the fourth consecutive day on Thursday. The AUD/USD pair acquires status as the US dollar (USD) remains restrained in improving risk sentiment.
The White House announced Wednesday that President Trump has temporarily exempt automakers from newly imposed import duties on Mexico and Canada for a month. Additionally, Trump is considering excluding certain agricultural products from tariffs in Canada and Mexico, according to a Bloomberg reporter late Wednesday.
Australia's trade surplus rose to 5.62 billion in January, exceeding the expected 5,500 million, improving from the past 4,924 million (revised from 5,085 million). Exports rose 1.3% in a month from the previous month, reaching an 11-month high due to non-financial money. Meanwhile, according to the Australian Bureau of Statistics, imports fell by 0.3% MOM after a sharp increase in the previous month.
Australian building permits surged to a 6.3% month month in January, accelerating significantly from the 1.7% growth revised upward in December. This marks the fastest pace, with the second consecutive expansion since last July.
Meanwhile, geopolitical tensions remain a concern. A spokesman for China's Foreign Ministry said late Wednesday that China is ready to fight “all types” in response to President Trump's escalating trade tariffs on a per-BBC basis. This allowed us to weigh the Australian dollar, given China's position as Australia's biggest trading partner.
The Australian Dollar is grateful as a US Dollar struggle amid concerns about US growth
- The US Dollar Index (DXY), which measures the US dollar against six major currencies, trades at approximately 104.30 at the time of writing. Greenback faced downward pressure amid concerns about slowing down our economic momentum.
- The change in US ADP employment in February reported just 77k of new jobs, well below the 140K forecast and well below the January 186K figure. Traders are currently looking closely at the US Non-Agricultural Payroll (NFP) report on Friday. The forecast suggests that it will increase from the suppressed 143K in January to 160K in February.
- President Donald Trump said Wednesday that he is working with House Republicans on an ongoing resolution to fund the government through September, according to Reuters.
- The Federal Reserve Beige book in March has become more important as concerns grow over the economic impact of President Trump's trade policy. Even before the full implementation of his trade measures, signs of tension are appearing within the US economy.
- The US ISM manufacturing PMI is slightly below the forecast of 50.5 at 50.3, down from 50.9 in January. In contrast, S&P Global's final production PMI in February exceeded expectations at 52.7, improving from preliminary reading.
- Australia's Gross Domestic Product (GDP) expanded in the fourth quarter 2024, exceeding 0.3% growth in the third quarter and exceeding market expectations by 0.5%. For the year, GDP rose 1.3% in the fourth quarter, up from 0.8% in the last quarter.
- Judo Bank's Combined Purchase Manager Index (PMI) recorded the fifth consecutive year of business activity growth, although slower, down from 51.1 in January in February to 50.6. Service PMI also eased from 51.2 to 50.8, reflecting the 13th consecutive month of continuous expansion, but at a relaxed rate.
- Andrew Hauser, Lieutenant Governor of the Reserve Bank of Australia (RBA), emphasized that the uncertainty in global trade is 50 years high. Hauser warned that uncertainty caused by US President Donald Trump's tariffs could encourage businesses and households to slow down plans and investments that could potentially strain economic growth.
- China cleared 3.8 trillion yuan ($53 billion) of bad assets in 2024 as authorities strengthened their efforts to tackle financial risks, according to the country's financial regulators. Looking forward to 2025, regulators have made the housing market a top priority, signaling ongoing efforts to stabilize the economy and rebuild confidence in the struggling real estate sector.
- The Chinese Service Purchase Manager Index (PMI) has unexpectedly increased from 51.0 to 51.4, exceeding the market forecast of 50.8 from 51.0 in January.
- Earlier on Wednesday, Chinese authorities announced that they had set a target for economic growth of around 5% for 2025 and a target of 2% for the Consumer Price Index (CPI). Additionally, China plans to implement aggressive fiscal policies while ensuring stability in both the real estate and stock markets.
Australian Dollar holds a position above 0.6300 for 9 days EMA support
The AUD/USD traded at nearly 0.6330 on Thursday, and technical analysis of the daily chart shows upward movement within the newly formed ascending channel pattern, indicating bullish bias. The 14-day relative strength index (RSI) remains above 50, further supporting the bullish outlook.
Conversely, the initial resistance is around the upper boundary of the ascending channel 0.6380, followed by a 3 month height of 0.6408 recorded on February 21st.
Immediate support is the 50-day Exponential Moving Average (EMA) of 0.6310 followed by a 9-day EMA at 0.6296. Additional support is at the lower boundary of the ascending channel at 0.6270. A break below this level could further decline to a four-week low of 0.6187 recorded on March 5th.
AUD/USD: Daily Charts
Australian dollar prices today
The table below shows the rate of change in the Australian Dollar (AUD) for today's listed major currencies. The Australian dollar was the strongest against the Japanese yen.
| USD | EUR | GBP | JPY | CAD | aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.03% | 0.08% | 0.22% | -0.10% | -0.01% | -0.03% | 0.18% | |
| EUR | 0.03% | 0.12% | 0.24% | -0.08% | 0.02% | -0.00% | 0.21% | |
| GBP | -0.08% | -0.12% | 0.15% | -0.19% | -0.10% | -0.11% | 0.10% | |
| JPY | -0.22% | -0.24% | -0.15% | -0.31% | -0.22% | -0.27% | -0.03% | |
| CAD | 0.10% | 0.08% | 0.19% | 0.31% | 0.10% | 0.07% | 0.28% | |
| aud | 0.01% | -0.02% | 0.10% | 0.22% | -0.10% | -0.02% | 0.19% | |
| NZD | 0.03% | 0.00% | 0.11% | 0.27% | -0.07% | 0.02% | 0.22% | |
| CHF | -0.18% | -0.21% | -0.10% | 0.03% | -0.28% | -0.19% | -0.22% |
The heatmap shows the rate of change of each other's major currencies. The base currency is selected from the left column, and the estimated currency is selected from the top row. For example, if you select Australian dollars from the left column and move along the horizon to US dollars, the rate of change shown in the box represents AUD (base)/USD (QUOTE).
Australian Dollar FAQ
One of the most important factors in the Australian Dollar (AUD) is the interest rate level set by the Reserve Bank of Australia (RBA). As Australia is a resource-rich country, another important factor is the price of iron ore, the biggest export. The health of China's biggest trading partner is Australia's inflation, its growth rate and trade balance. Market sentiment – Whether investors are taking on riskier assets (risk-on) or seeking safe haven (risk-off) is another factor in risk-on positive for AUD.
The Reserve Bank of Australia (RBA) affects the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This affects the level of interest rates across the economy. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up and down. Compared to other major central banks, relatively high interest rates support AUD, the opposite of relatively low. RBAs can also use quantitative relaxation and tightening to influence credit conditions, along with previous Aud negative and the latter positives.
As China is Australia's largest trading partner, the health of China's economy has a major impact on the value of the Australian Dollar (AUD). If the Chinese economy is on track, they will buy more raw materials, goods and services from Australia, raising demand for AUD and increasing its value. The opposite is when the Chinese economy is not growing as fast as expected. Therefore, positive or negative surprises in China's growth data often have a direct impact on the Australian dollar and its pair.
Iron ore is Australia's largest export, with China as its main destination accounting for $118 billion a year, according to data from 2021. Therefore, iron ore prices could be a driver for the Australian dollar. Generally, as iron ore prices rise, so does AUD as aggregate demand for the currency increases. If iron ore prices fall, the opposite is true. Also, higher iron ore prices tend to be more likely to be positive for Australia's trade balance, which is also positive for AUD.
Trade balances, the difference between what a country acquires from exports and what it pays for imports, are another factor that can affect the value of the Australian Dollar. If Australia produces a very popular export, the currency acquires pure value from the surplus demand generated from foreign buyers seeking to purchase the export, compared to what they spend to buy the import. Therefore, a positive net trade balance strengthens the AUD and has the opposite effect if the trade balance is negative.
