AUD/USD Forecast and News


AUD/USD: Strong resistance lies at 0.6300

The marked sell-off in the US Dollar allowed AUD/USD to regain strong upside traction and reach multi-day highs in the area just below the key 0.6300 barrier at the beginning of the week.

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AUD/USD Technical Overview

AUD/USD remains under pressure, with key support at 0.6130. A break below this level could open the door for a drop toward the psychologically significant 0.6000 mark. On the upside, resistance levels are seen at 0.6301, followed by 0.6401 and 0.6549. Momentum signals are mixed—while the RSI approached the 50 yardstick, the ADX lost some impetus and reached 30, indicating that the current trend appears to be running out of steam.


Fundamental Overview

The US Dollar (USD) experienced a rollercoaster ride on Monday, with the US Dollar Index (DXY) dipping below the 108.00 support to flirt with yearly lows once again in the broad context of dominant risk-on sentiment.

Meanwhile, the Australian Dollar (AUD) reversed two daily pullbacks in a row, reclaiming the 0.6200 hurdle and well above to hit fresh multi-day peaks.

What’s Driving the Australian Dollar’s Rebound?

While the Australian Dollar has struggled against a resilient US Dollar, it has recently clawed back some ground, aided by Monday’s pronounced retreat in the Greenback. The USD’s extended rally, which began in October amid the so-called "Trump trade," had placed significant pressure on the Aussie and the rest of the risk-linked universe.

Domestically, the Reserve Bank of Australia (RBA) is weighing a potential rate cut in February to counter slower economic growth and softening inflation. Market expectations for a cut currently sit at around 60%.

Adding to the AUD's challenges are faltering domestic economic momentum, weaker confidence indicators, and concerns about China’s slowing economy—a critical driver of Australian exports. Subdued commodity prices have further dampened the currency’s outlook.

On the brighter side, December’s Australian jobs report offered some positive news last week. Employment surged by 56.3K jobs, well above expectations, although the Unemployment Rate edged up slightly to 4.0% (from 3.9%). Meanwhile, the Melbourne Institute’s Consumer Inflation Expectations eased to 4.0% in January, down from 4.2%, signalling a potential cooling in inflationary pressures.

RBA’s Cautious Stance

At its December meeting, the RBA held rates steady at 4.35% but indicated that future cuts remain on the table as inflation eases. RBA Governor Michele Bullock emphasized that upcoming policy decisions will be closely tied to economic data.

Challenges and Opportunities for AUD/USD

The AUD/USD pair faces notable headwinds from the US Dollar’s strength, Australia’s mixed economic fundamentals, and concerns over China’s sluggish recovery. However, the Aussie could find support if the Federal Reserve signals further rate cuts, which would likely weaken the USD.

What to Watch This Week

A light weekly calendar in Oz this week will only include the Westpac Leading Index (January 22).



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

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. 

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AUD/USD Big Picture

AUD/USD Bullish Themes

AUD/USD Bearish Themes

FXS Signals

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Editors' picks

EUR/USD: Bulls need to clear 1.0400 on a convincing fashion

EUR/USD: Bulls need to clear 1.0400 on a convincing fashion

In line with the rest of the risk-associated complex, EUR/USD managed to regain marked buying pressure and flirted with the area of three-week highs around 1.0430 on Monday.

EUR/USD News
GBP/USD stays defensive below 1.2200, awaits Trump 2.0

GBP/USD stays defensive below 1.2200, awaits Trump 2.0

GBP/USD struggles to gain traction and trades slightly below 1.2200 in the second half of the day on Monday. Markets' nervousness ahead of US President-elect Donald Trump's inauguration drag the pair lower despite a broadly weaker US Dollar. 

GBP/USD News
Japanese Yen surrenders modest intraday gains against USD ahead of Trump's inaugural speech

Japanese Yen surrenders modest intraday gains against USD ahead of Trump's inaugural speech

The Japanese Yen strengthens in reaction to the upbeat Core Machinery Orders data. Firming expectations for an additional BoJ rate hike this week also underpin the JPY. A modest USD downtick further contributes to the USD/JPY pair's intraday decline.  A positive risk tone caps the safe-haven JPY ahead of Trump's inaugural address. 

USD/JPY News
Gold remains focused on all-time highs

Gold remains focused on all-time highs

Gold stays in positive territory above $2,700 on Monday as the improving risk mood makes it difficult for the US Dollar to find demand. Markets await US President Donald Trump's speech at the inauguration ceremony.

Gold News
WTI remains subdued near $77.00 due to market caution ahead of Trump’s inauguration

WTI remains subdued near $77.00 due to market caution ahead of Trump’s inauguration

West Texas Intermediate extends losses for the third successive session, trading near $77.20 per barrel during Monday's Asian session. Oil traders adopt a cautious stance ahead of President-elect Donald Trump’s inauguration later in the day. 

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Signatures


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.

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.

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).