AUD/USD Forecast and News
AUD/USD jumps to near 0.6350 as US Dollar plummets after Trump’s tariff plan
The AUD/USD pair moves higher and advances toward the two-week high of 0.6350 in Thursday’s European session. The Aussie pair strengthens as the US Dollar faces an intense sell-off, with traders becoming increasingly confident that the new suite of tariffs by President Donald Trump will lead to a United States recession in the near term.
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AUD/USD Technical Overview
A convincing break above the 2025 peak at 0.6408 (February 21) would pave the way for a run at the 200-day SMA near the 0.6500 milestone, with the November 2024 high of 0.6687 looming as the next major hurdle.
On the downside, initial support stands at the March low of 0.6186 (March 4). A clear move below that floor would expose the 2025 trough at 0.6087, just above the psychological 0.6000 mark.
Meanwhile, the Relative Strength Index (RSI) inching toward 60 suggests a fresh revival of upside momentum, but the subdued Average Directional Index (ADX) around 11 implies a still-weak overarching trend.
Fundamental Overview
The Australian Dollar (AUD) extended its weekly rebound in style, encouraging AUD/USD to come closer to the key 0.6400 threshold and flirt with multi-week highs on the back of the deep sell-off in the US Dollar (DXY).
The pronounced drop in the Greenback sent the US Dollar Index (DXY) to levels last visited in early October in the 101.30-101.20 band amid an equally sharp downtick in US yields across the spectrum, all amid investors’ adjustment to the recently announced tariffs by the White House.
Rising global trade war fears
In the meantime, concerns about a transatlantic trade war did nothing but escalate in past hours, especially after President Trump hit US trade partners with a new round of tariffs from 10% to around 50%.
This measure might surely prompt countries to implement retaliatory measures, therefore sparking a global trade war with serious impact on the economic activity, as well as consumer prices and monetary policy decisions by central banks.
The Aussie, closely tied to global risk appetite and Chinese demand for commodities, remains vulnerable to any slowdown in China and is expected to remain wary on any impact from US tariffs.
Fed on a tightrope
Across the Pacific, the Federal Reserve (Fed) faces its own delicate balancing act. Escalating trade tensions could drive inflation higher, potentially justifying further rate hikes. Yet early signals of a cooling US economy make a strong case for caution—despite employment data remaining healthy.
At its March 19 meeting, the Fed held the benchmark rate at 4.25–4.50% and maintained a “wait-and-see” approach. Fed Chair Jerome Powell emphasized caution, noting forecasts of slower growth and marginally higher inflation—both of which could be amplified by impending tariffs.
RBA steady amid uncertainty
In Australia, the Reserve Bank (RBA) kept its Official Cash Rate (OCR) at 4.10% on Tuesday, a move widely anticipated by markets. Notably, the RBA dropped its prior reference to being “cautious on prospects for further policy easing,” instead pointing to persistent risks on both sides of the economic equation.
During the post-meeting press conference, RBA Governor Michele Bullock acknowledged less-than-complete certainty about inflation’s path toward the 2–3% target range. She also noted that the decision to keep rates unchanged was unanimous, with no direct talk of cuts. Following the announcement, the odds of a 25-basis-point cut at the May 20 meeting slipped to 70%, down from 80%.
Bears bet on the Aussie
In the background, traders continued to ramp up bearish bets on the Australian Dollar. The latest CFTC data shows net short positions hovering near 80K contracts as of March 25—a multi-week high that has risen steadily since mid-December amid escalating tariff concerns.
In essence, the Aussie Dollar’s short-term bounce remains at the mercy of unfolding trade tensions, China’s economic signals, and the delicate policy manoeuvres of central banks on both sides of the Pacific.
SPECIAL WEEKLY FORECAST
Interested in weekly AUD/USD forecasts? Our experts make weekly updates forecasting the next possible moves of the Australian Dollar-US Dollar pair. Here you can find the most recent forecast by our market experts:
AUD/USD: Interim top confirmed, 0.7000 at risk Premium
The AUD/USD pair kept falling in the last few days, reaching a fresh multi-week low of 0.7263 on Friday, to close the trading week a handful of pips above it.
AUD/USD Big Picture
AUD/USD Bullish Themes
AUD/USD Bearish Themes
Latest AUD Analysis
Editors' picks
EUR/USD retreats from multi-month tops, back near 1.1050
Following a move to six-month highs in the 1.1140-1.1150 band, EUR/USD now gives away part of those gains on the back of a mild attempt of recovery in the US Dollar as investors continue to assess President Trump's recent annoucements.
GBP/USD off highs, remains well bid near 1.3100
GBP/USD now partially sets aside its earlier advance in favour of fresh peaks just north of the 1.3200 mark, challenging the 1.3100 neighborhood on the back of a tepid bounce from recent multi-month lows in the Greenback.
Japanese Yen retains bullish bias against USD amid heightened safe-haven demand
The Japanese Yen caught aggressive bids during the Asian session on Thursday amid the global flight to safety, triggered by US President Donald Trump's sweeping reciprocal tariffs. Investors grew increasingly concerned that the move could reshape the global trading system and impact negatively on the world economy, sending shockwaves through global financial markets.
Gold looks offered near $3,100
Prices of Gold remain on the defensive on Thursday, hovering around the $3,100 region per troy ounce and retreating from earlier all-time peaks near the $3,170 level, all against the backdrop of investors' assessment of "Liberation Day".
WTI drops below $67 on demand concerns, OPEC+ output hike
Crude oil prices decline sharply on Thursday, pressured by growing concerns over the demand outlook following US President Donald Trump's tariff announcements and OPEC+ decision to increase oil output.
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AUD/USD YEARLY FORECAST
What would happen to the AUD/USD this year? A brief update from our experts on where the AUD/USD can go in the upcoming months.
AUD/USD FORECAST 2025
The battle between the Australian Dollar (AUD) and the US Dollar (USD) will be one worth watching in 2025, with central banks stealing the limelight. The Reserve Bank of Australia (RBA) has kept interest rates at record highs whilst most of its overseas counterparts started the loosening process. The US Federal Reserve (Fed), on the other hand, has trimmed the benchmark interest rate by 100 bps through 2024 and aims to slow the pace of cuts in 2025. The central banks’ imbalance aims for record lows in AUD/USD.
MOST INFLUENTIAL POLITICAL EVENTS IN 2025 FOR AUD/USD
Beyond central banks, market players will be attentive to tariffs. The second coming of Donald Trump to the White House anticipates a global Trade War that could fuel inflationary pressures not only in the United States, but also in all major economies.
Given Trump’s personal battle with China, the Australian economy could end up benefiting from fresh commercial interactions with its neighbour giant.
About AUD/USD
AUD/USD, The 'Aussie'
The AUD/USD pair, also called the “Aussie”, tells the trader how many US dollars (the quote currency) are needed to purchase one Australian dollar (the base currency). This currency pair is also known as the "Aussie". Together with the New Zealand Dollar and the Canadian Dollar, the AUD is a commodity currency, that is a currency whose country's exports are largely comprised of raw materials (precious metals, oil, agriculture, etc.).
The interest rates set by the Reserve Bank of Australia (RBA) have been among the highest of industrialized countries and the relatively high liquidity of the AUD has made it an attractive tool for carry traders looking for a currency with the highest yields. These factors made the AUD very popular among currency traders.
AUD/USD CORRELATIONS
Australia is a big exporter to China and its economy and currency reflect any change in the situation in that country. The prevailing view is that the Australian Dollar offers diversification benefits in a portfolio containing the major world currencies because of its greater exposure to Asian economies.
This correlation with the Shanghai stock exchange is to be added to the correlation it has with gold. The pair AUD/USD often rises and falls along with the price of gold. In the financial world, gold is viewed as a safe haven against inflation and it is one of the most traded commodities.
ORGANIZATIONS, PEOPLE AND ECONOMIC DATA THAT INFLUENCE AUD/USD
The AUD/USD news can be seriously affected by the decisions taken by these organizations and people:
- Reserve Bank of Australia (RBA) that issues statements and decides on the interest rates of the country. Its president is Michele Bullock.
- Australian Government and its Department of Finance that implement policies that affect the economy of the country.
- The US Government: events as administration statements, new laws and regulations or fiscal policy can increase or decrease the value of the US Dollar and the currencies traded against it, in this case, the Australian Dollar.
- Fed, the Federal Reserve of the United States whose president is Jerome Powell. The Fed controls the monetary policy, through active duties such as managing interest rates, setting the reserve requirement, and acting as a lender of last resort to the banking sector during times of bank insolvency or financial crisis.
In terms of economic data, as for most currencies, the AUDUSD traders have to keep an eye on:
- GDP (Gross Domestic Product), the total market value of all final goods and services produced in a country. It is a gross measure of market activity because it indicates the pace at which a country's economy is growing or decreasing. Generally speaking, a high reading or a better than expected number is seen as positive for the AUD, while a low reading is negative.
- Inflation measured by key indicators as the CPI (Core Price Index) and the PPI (Production Price Index), which reflect changes in purchasing trends.
- Current Trade Balance, a balance between exports and imports of total goods and services. A positive value shows trade surplus, while a negative value shows trade deficit. If a steady demand in exchange for AUD exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the AUD.
Michele Bullock
Michele Bullock is an Australian economist who is currently governor of the Reserve Bank of Australia. She commenced as governor on 18 September 2023, and is the first woman to hold the role. She is Chair of the Reserve Bank Board, Payments System Board and Council of Financial Regulators. Prior to her current role, Ms Bullock was the Deputy Governor of the Reserve Bank of Australia.
Michele Bullock RBA's Profile and Wikipedia
Jerome Powell
Jerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in February 2018, for a four-year term ending in February 2022. His term as a member of the Board of Governors will expire January 31, 2028. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997 through 2005, Powell was a partner at The Carlyle Group.
Jerome Powell Fed's Profile and Wikipedia
RBA NEWS & ANALYSIS
FED NEWS & ANALYSIS
ASSETS THAT INFLUENCE AUD/USD THE MOST
- Currencies: NZD and JPY (New Zealand and Japan are important regional partners of Australia). Other important group of influent pairs includes: EUR/USD, GBP/USD, USD/JPY, USD/CHF, NZD/USD and USD/CAD.
- Commodities: The most important is Gold, as already explained above, but also Iron Ore and Natural Gas.
- Bonds: GACGB10 (Australian Government Bonds Generic Yield 10 Year), GNZGB10 (New Zealand Government Bond 10 Year) and T-NOTE 10Y (10 year US Treasury note).
- Indices: S&P/ASX 200 (stocks of the Australian Securities Exchange), S&P/TSX Global Gold Index (includes producers of gold and related products at the Toronto Stock Exchange).