AUD/USD hung out to dry on familiar low end

• AUD/USD continues to keep a tight grip on 0.6200.
• Market sentiment drifted in favor of safe havens to start 2025.
• Aussie traders await further hints from RBA on policy direction before picking a side.

AUD/USD tried and failed to spark a bull run during the first trading session of 2025, rising on thin volumes before collapsing back into the 0.6200 handle in the later hours of the day. A broad-market push into the safe haven Greenback kept the Aussie pair on the defensive, and the AUD is mired in congestion on the weak side of two-year lows.

The economic data calendar is largely dark on the Antipoodean side for the rest of the week, leaving investors to grapple with US Purchasing Managers Index (PMI) figures due on Friday and a cloudy picture on the Aussie's interest rate differential outlook.

The Federal Reserve (Fed) is poised to make fewer interest rate cuts through 2025 than previously expected, keeping the US Dollar well-bid across the board alongside a general malaise that has struck market participants in recent months. Market flows are still constrained by the New Year's holidays that shuttered markets during the midweek market session, but a wobbly stance to fresh volumes at the outset of the new trading season bode poorly for near-term gains for the Aussie.

US ISM Manufacturing PMI survey results on Friday are expected to hold flat at a contractionary 48.2.

AUD/USD price forecast

AUD/USD bulls will be look for a fresh breakout to the topside in the coming days as bids appear to be pumping the brakes on further declines. However, a fresh round of short-selling isn't entirely off the table, especially if the bottom falls out of near-term price action and sends bids below last week's floor set near 0.6180.

AUD/USD daily chart