AUD USD

Australia's inflation problem extends well beyond energy, with markets now pricing further RBA hikes into 2027. So why has AUD/USD reversed sharply after its initial surge?

As the trading week progresses, a cautious tone is becoming increasingly evident around the Australian dollar. This can be observed in the recent performance of AUD/USD, where price action has remained largely unchanged over the last three trading sessions, recording a move of barely 0.1%. This behavior highlights a clear lack of direction within the market.

Aussie and Kiwi have gone remarkably quiet ahead of Australian inflation data and RBNZ decision. With substantial tightening priced and both events capable of generating major FX swings, Wednesday could deliver a volatility eruption in the antipodes.

A sharp reversal off key support has fueled the AUD/USD recovery, with resistance now in focus ahead of next week’s Fed decision and Australian CPI.

A weaker US dollar, falling Treasury yields and renewed demand for cyclical assets have supported the Aussie and Kiwi. But with some of those moves reversing on Monday, both currencies face an early test of whether their recent strength can continue.

AUD/USD has been hit by another ugly Australian employment report, sending RBA rate hike expectations sharply lower. Yet the relationships driving the currency have shifted since quarter-end, and improving risk appetite could provide the fuel for a recovery.

AUD/USD is trying to hold a fresh trend break as renewed selling pressure tests whether the recovery can extend beyond the recent rebound.

The Aussie is coiling beneath 0.7000 ahead of US CPI, with its relationship with US front-end yields strengthening sharply just as markets question whether the Fed will need to hike again this month.

Aussie is pressing a key trend barrier after rebounding from support, with next week’s CPI report poised to test the recovery.

With major macro catalysts scarce, the Australian dollar is taking its cues from risk appetite and relative yields. Two emerging technical patterns suggest AUD/USD and AUD/JPY could be worth monitoring for very different reasons.

Sr. Technical Strategist Michael Boutros highlights the levels that matter on the USD Majors, commodities, and equity indices charts this week.

US yields, dollar strength and fading RBA hike bets have combined to drive AUD/USD to fresh multi-month lows. The macro and technical bias remains bearish, although history suggests parts of the move are now reaching unusually stretched levels.