Created
: 2025.04.24
- English
- English
- What's Myforex
- Share
- Use tools
- Get information
- What's New
- Help center
- About us
- Customer support
- Terms and policies
-
-
PortfolioShare your portfolio and performance in real time -
Events & contestsEvents and contests held by retail brokers around the world
-
-
Real-time spread comparisonCompare spreads of major retail brokers in real time -
Volatility analysisVisualize volatility as a measure of daily market activity -
Swap point comparisonCompare buy and sell swap values for each broker by symbol -
Market rates & chartsCheck prices for all instruments offered by each broker -
IndicatorsProviding in-house developed indicators for MT4/MT5 -
Trading calculatorsCalculation tools for each broker to help you trade
-
-
World FX newsLatest news on forex and cryptocurrencies from around the world -
Broker informationTrading information of retail brokers worldwide -
MetaTrader4/5 user guideUser guide collection for the latest MetaTrader4/5 -
Economic calendarRelease calendar for indicators from official sources of major economies
AUD/USD bounces back to near 0.6400 as US Dollar's recovery fizzle out
World FX news
Breaking news
AUD/USD bounces back to near 0.6400 as US Dollar's recovery fizzle out
New
2025.04.24 19:51
2025.04.24 19:51
2025.04.24 19:51
- AUD/USD recovers sharply to near 0.6400 at the expense of the US Dollar.
- Washington has signaled its willingness to negotiate a trade deal with China.
- The RBA is expected to cut interest rates next month.
The AUD/USD pair rebounds to near 0.6390 during European trading hours on Thursday. The Aussie pair recovers as the two-day recovery in the US Dollar (USD) has fizzled out despite ebbing fears of an intense trade war between the United States (US) and China.
The US Dollar Index (DXY), which gauges the Greenback's value against six major currencies, retreats to near 99.20 from Wednesday's high around 100.00.
US President Donald Trump has expressed a willingness to make a trade deal with China. "Discussions with Beijing are going well, and I think that we will reach a deal," Trump said on Tuesday. Hopes of a de-escalation in the tariff war between the world's two largest powerhouses have improved further as US Treasury Secretary Scott Bessent has shown openness to lower tariffs. "I don't think either side believes that the current tariff levels are sustainable, so I would not be surprised if they went down in a mutual way," Bessent said.
Meanwhile, fears of a resurgence in US inflation have escalated as the flash S&P Global Purchasing Managers' Index (PMI) report showed that respondents have signaled passing the impact of tariffs on consumers. Such an event will limit the Federal Reserve's (Fed) capability of reducing interest rates.
Easing tensions between Washington and China is also a favorable scenario for the Australian Dollar (AUD), given the significant dependence of the Australian economy on its exports to China.
Domestically, increasing odds of an interest rate cut by the Reserve Bank of Australia (RBA) in the May policy meeting could weigh on the Aussie Dollar. According to analysts at Westpac, the RBA will reduce its Official Cash Rate (OCR) by 25 basis points (bps) to 3.85% in May amid growing downside risks to inflation and global economic growth.
Australian Dollar FAQs
One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment - whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) - is also a factor, with risk-on positive for AUD.
The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive.
China is Australia's largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs.
Iron Ore is Australia's largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD.
The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.
Last updated
: 2025.04.24
Related articles
USD slips as stocks dip - Scotiabank
43 minutes agoCAD lags peers as markets ponder US trade policy - Scotiabank
43 minutes agoFed's Hammack: The US economy is very resilient
2025.04.24 22:05ECB's Lane: No reason to say we're always going to do default 25 bps moves
2025.04.24 22:02US Durable Goods Orders rise by 9.2% in March vs. 2% expected
2025.04.24 21:36US: Initial Jobless Claims rose to 222K last week
2025.04.24 21:36
FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.
Was this article helpful?
We hope you find this article useful. Any comments or suggestions will be greatly appreciated.
We are also looking for writers with extensive experience in forex and crypto to join us.
please contact us at [email protected].
Thank you for your feedback.
Thank you for your feedback.
Most viewed
USD slips as stocks dip - Scotiabank
The US Dollar (USD) is tracking lower again after two days of gains lifted the DXY some 2% off the three year low reached earlier in the week. The CHF and JPY are sitting near the top of the overnight performance table, just behind the SEK and NOK.
New
2025.04.24 22:25CAD lags peers as markets ponder US trade policy - Scotiabank
The Canadian Dollar (CAD) is trading modestly higher against the US Dollar (USD) in relatively quiet trade, Scotiabank's Chief FX Strategist Shaun Osborne notes.
New
2025.04.24 22:25Fed's Hammack: The US economy is very resilient
Beth Hammack, president of the Federal Reserve Bank of Cleveland, said that the central bank should exercise patience in its monetary policy amid high uncertainty and added that she would not rule out making adjustments by June if the data warranted action.
New
2025.04.24 22:05ECB's Lane: No reason to say we're always going to do default 25 bps moves
European Central Bank Chief Economist Philip Lane told Bloomberg News on Thursday that he doesn't expect the trade fallout to trigger a recession in the Euro area.
New
2025.04.24 22:02US Durable Goods Orders rise by 9.2% in March vs. 2% expected
Durable Goods Orders in the US rose by 9.2%, or $26.6 billion, in March to $315.7 billion, the US Census Bureau reported on Thursday. This reading followed a 0.9% increase reported in February and surpassed the market expectation for an increase of 2% by a wide margin.
New
2025.04.24 21:36US: Initial Jobless Claims rose to 222K last week
US citizens filing new applications for unemployment insurance increased to 222K for the week ending April 19, as reported by the US Department of Labor (DOL) on Thursday.
New
2025.04.24 21:36JPY outperforming on mild risk off - Scotiabank
Japanese Yen (JPY) is entering Thursday's NA session with an impressive 0.8% gain, outperforming most of the G10 currencies on the back of mild risk aversion, Scotiabank's Chief FX Strategist Shaun Osborne notes.
New
2025.04.24 20:50GBP sees modest gains - Scotiabank
Pound Sterling (GBP) is up 0.5% against the US Dollar (USD) but marginally underperforming most of the G10 currencies within the context of broad-based USD weakness, Scotiabank's Chief FX Strategist Shaun Osborne notes.
New
2025.04.24 20:47USD/JPY falls back to near 142.30 as USD's relief recovery shrinks
The USD/JPY pair retreats to near 142.30 during European trading hours on Thursday after a relief recovery move seen in the last two trading days. The pair falls back as the US Dollar Index (DXY) retraces after failing to extend its two-day recovery above the key level of 100.00.
New
2025.04.24 20:45EUR strengthens despite increasingly dovish comments from ECB - Scotiabank
Euro (EUR) is up 0.7% against the US Dollar (USD), a mid-performer among the G10 and strengthening within the context of a broadly weaker dollar driven by headlines related to trade, Scotiabank's Chief FX Strategist Shaun Osborne notes.
New
2025.04.24 20:40Disclaimer:
All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.
The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.
Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy
