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AUD/USD gains sharply to near 0.6510, broadly remains confined ahead of US inflation data

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AUD/USD gains sharply to near 0.6510, broadly remains confined ahead of US inflation data

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New update 2025.10.23 17:46
AUD/USD gains sharply to near 0.6510, broadly remains confined ahead of US inflation data

update 2025.10.23 17:46

  • AUD/USD rises to near 0.6510 as the Australian Dollar outperforms across the board.
  • Investors bullish on the Australian Dollar seem to have ignored US threats to restrict exports of software-powered products to China.
  • Investors await the US CPI data for September.

The AUD/USD pair trades 0.3% higher to near 0.6510 during the European trading session on Thursday. However, the Aussie pair has been trading inside the three-day-long trading range of 0.6473-0.6525, with investors awaiting the United States (US) Consumer Price Index (CPI) data for September, which will be published on Friday.

Australian Dollar Price Today

The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the Japanese Yen.

USD EUR GBP JPY CAD AUD NZD CHF
USD 0.11% 0.07% 0.43% 0.00% -0.31% -0.15% 0.20%
EUR -0.11% -0.04% 0.34% -0.11% -0.41% -0.25% 0.10%
GBP -0.07% 0.04% 0.37% -0.05% -0.35% -0.21% 0.13%
JPY -0.43% -0.34% -0.37% -0.43% -0.72% -0.59% -0.22%
CAD -0.00% 0.11% 0.05% 0.43% -0.30% -0.15% 0.20%
AUD 0.31% 0.41% 0.35% 0.72% 0.30% 0.16% 0.51%
NZD 0.15% 0.25% 0.21% 0.59% 0.15% -0.16% 0.35%
CHF -0.20% -0.10% -0.13% 0.22% -0.20% -0.51% -0.35%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).

The impact of the inflation data will be significant for the US Dollar, as the data has been delayed due to the ongoing federal shutdown. Economists expect the US headline inflation to have risen at a faster pace of 3.1% on an annualized basis against the prior release of 2.9%, with core figures growing steadily by 3.1%.

The Aussie pair gains sharply as the Australian Dollar (AUD) outperforms its peers despite renewed trade tensions between the United States (US) and China.

On Wednesday, a report from Reuters showed that Washington plans to impose export controls on software-powered products, from laptops to jet engines, to China. This came in response to the latest restrictions imposed on the export of rare earth minerals from Beijing to the US.

This came ahead of the meeting between US Treasury Secretary Scott Bessent and China Vice Premier He Lifeng, scheduled this weekend in Malaysia.

The impact of US-China trade tensions is technically unfavorable for the Australian Dollar, given that the Asia-Pacific economy relies heavily on its exports to Beijing.

On the domestic front, investors await Q3 CPI data, which will be published on October 29.

 

Inflation FAQs

Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%.

The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls.

Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money.

Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.



Date

Created

 : 2025.10.23

Update

Last updated

 : 2025.10.23

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