Forex News
Reserve Bank of Australia (RBA) Deputy Governor Andrew Hauser said on Tuesday, “the Australian Dollar (AUD) has been a well-functioning 'natural' hedge for global risk assets.”
Additional quotes
Uncertainty obviously remains high.
But predictions of the death of the US dollar and Australian hedging model appear somewhat premature.
Pension funds will have to expand use of FX hedging over time to avoid hitting concentration limits.
That especially as funds will have to invest more overseas given the lack of domestic assets.
Market reaction
At the time of writing, AUD/USD is modestly flat on the day, just below 10-month highs of 0.6676.
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 New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.15% | -0.14% | -0.18% | -0.05% | 0.02% | 0.09% | -0.14% | |
| EUR | 0.15% | 0.01% | -0.16% | 0.09% | 0.22% | 0.22% | 0.00% | |
| GBP | 0.14% | -0.01% | -0.12% | 0.08% | 0.22% | 0.22% | -0.02% | |
| JPY | 0.18% | 0.16% | 0.12% | 0.19% | 0.26% | 0.08% | 0.07% | |
| CAD | 0.05% | -0.09% | -0.08% | -0.19% | 0.08% | 0.10% | -0.09% | |
| AUD | -0.02% | -0.22% | -0.22% | -0.26% | -0.08% | 0.09% | -0.21% | |
| NZD | -0.09% | -0.22% | -0.22% | -0.08% | -0.10% | -0.09% | -0.18% | |
| CHF | 0.14% | -0.01% | 0.02% | -0.07% | 0.09% | 0.21% | 0.18% |
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).
- NZD/USD trades sideways around 0.5970 ahead of the Fed’s monetary policy outcome and NZ Q2 GDP data.
- The Fed is expected to cut interest rates on Wednesday amid downside labor market risks.
- The NZ economy is estimated to have contracted by 0.3% in the second quarter of the year.
The NZD/USD pair trades in a tight range around 0.5970 during the late Asian trading session on Tuesday. Investors brace for significant volatility in the Kiwi pair as the Federal Reserve’s (Fed) monetary policy announcement and New Zealand’s (NZ) Q2 Gross Domestic Product (GDP) data are scheduled for Wednesday and Thursday, respectively.
In late Asian trading hours, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades close to a seven-week low near 97.10.
On Wednesday, the Fed is certain to start the monetary-easing campaign in the wake of growing United States (US) labor market risks.
According to the CME FedWatch tool, there is a 96% chance that the Fed will reduce interest rates by 25 basis points (bps) to 4.00%-4.25%, while the rest support a bigger reduction of 50 bps.
In Tuesday’s session, investors will focus on the US Retail Sales data for August, which will be published at 12:30 GMT. The US Retail Sales data is expected to come in lower at 0.3% on a monthly basis against the prior release of 0.5%.
In the NZ economy, the GDP growth is expected to have declined by 0.3% in the second quarter of the year after rising by 0.8% in the previous quarter. The scenario of contraction in the NZ GDP growth will boost market speculation for more interest rate cuts by the Reserve Bank of New Zealand (RBNZ) in the remainder of the year.
Economic Indicator
Fed Interest Rate Decision
The Federal Reserve (Fed) deliberates on monetary policy and makes a decision on interest rates at eight pre-scheduled meetings per year. It has two mandates: to keep inflation at 2%, and to maintain full employment. Its main tool for achieving this is by setting interest rates – both at which it lends to banks and banks lend to each other. If it decides to hike rates, the US Dollar (USD) tends to strengthen as it attracts more foreign capital inflows. If it cuts rates, it tends to weaken the USD as capital drains out to countries offering higher returns. If rates are left unchanged, attention turns to the tone of the Federal Open Market Committee (FOMC) statement, and whether it is hawkish (expectant of higher future interest rates), or dovish (expectant of lower future rates).
Read more.Next release: Wed Sep 17, 2025 18:00
Frequency: Irregular
Consensus: 4.25%
Previous: 4.5%
Source: Federal Reserve
- Australian Dollar retreats after reaching a 10-month high at 0.6676, reached on Tuesday.
- China and the US reached a commercial agreement on Monday to transfer TikTok into US ownership.
- The US Dollar extends losses as the Fed is expected to deliver a 25-basis-point rate cut.
The Australian Dollar (AUD) declines against the US Dollar (USD) on Tuesday after registering gains in the previous session. The AUD/USD pair appreciated as the US Dollar (USD) struggled ahead of the looming US Federal Reserve (Fed) policy meeting due on Wednesday.
The AUD could have received support after China and the United States (US) reached a commercial agreement on Monday to place TikTok under US ownership, with final approval anticipated during a Friday call between US President Donald Trump and Chinese President Xi Jinping. Trump wrote on “Social Truth” that the “big Trade Meeting” went “VERY WELL!” and emphasized that US-China relations remain “very strong.”
Reserve Bank of Australia (RBA) Assistant Governor Sarah Hunter said on Tuesday that the central bank is “close to getting inflation to target.” Hunter noted that risks to the outlook are balanced and emphasized the need for a forward-looking approach given the delayed impact of monetary policy. She added that the RBA is closely monitoring the underlying strength of consumer spending and aims to keep the economy near full employment.
The Aussie Dollar finds support on the fading likelihood of further Reserve Bank of Australia (RBA) rate cuts. Swaps now price in an 86% likelihood of unchanged policy in September, bolstered by Australia’s strong July trade surplus, solid Q2 GDP, and hotter July inflation. Consumer Inflation Expectations also climbed in September, signaling stronger domestic demand and raising concerns about renewed inflationary pressures.
Australian Dollar struggles despite risk-on mood
- The US Dollar Index (DXY), which measures the value of the US Dollar against six major currencies, is extending losses and trading around 97.20 at the time of writing. Traders will likely be observing the US Retail Sales data for August, due on Tuesday, which could offer fresh cues on US consumer spending.
- The US Senate confirmed Stephen Miran by a 48-47 vote to fill the Federal Reserve Board seat vacated by Adriana Kugler last month. Miran will be the first executive-branch official to serve on the central bank’s board since 1935.
- The US Federal Reserve is expected to lower rates by 25 basis points at its September meeting, though there remains a slight chance of a 50-basis-point cut. Markets have also factored in continued easing through 2026 to help stave off a potential recession.
- Morgan Stanley and Deutsche Bank now expect the US central bank to deliver three rate cuts this year, after recent data pointed to easing inflation pressures. In separate notes on Friday, the brokerages projected 25-basis-point reductions at each of the Fed’s remaining meetings in September, October, and December, according to Reuters.
- Traders are now expecting multiple Fed rate cuts after US Weekly Initial Jobless Claims climbed to their highest since October 2021, following last week’s weak Nonfarm Payrolls report, overshadowing a hotter-than-expected consumer inflation reading.
- The National Bureau of Statistics (NBS) showed on Monday that China’s Retail Sales rose 3.4% year-over-year (YoY) in August vs. 3.8% expected and 3.7% in July. Chinese Industrial Production increased 5.2% YoY in the same period, compared to the 5.8% forecast and 5.7% seen previously.
- The NBS said during its press conference on Monday that economic operation was generally steady in August, but domestic demand will expand and promote a rebound in prices. Some firms are having difficulties in operations as the external environment is very severe, NBS added.
Australian Dollar eyes 11-month highs near 0.6700
AUD/USD is trading around 0.6660 on Tuesday. The technical analysis of the daily chart shows that the pair moves upwards within an ascending channel pattern, indicating a bullish market bias. Additionally, the pair is positioned above the nine-day Exponential Moving Average (EMA), indicating short-term price momentum is stronger.
On the upside, the AUD/USD pair may target the 11-month high of 0.6687, recorded in November 2024, followed by the upper boundary of the ascending channel around 0.6700.
The AUD/USD pair may find its initial support at the nine-day EMA of 0.6621, followed by the ascending channel’s lower boundary around 0.6570. A break below the channel would weaken the short-term price momentum and lead the AUD/USD pair to test the 50-day EMA at 0.6535.
AUD/USD: Daily Chart
Australian Dollar Price Today
The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the weakest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.15% | -0.15% | -0.22% | -0.06% | 0.04% | 0.08% | -0.14% | |
| EUR | 0.15% | -0.00% | -0.21% | 0.08% | 0.24% | 0.21% | 0.00% | |
| GBP | 0.15% | 0.00% | -0.16% | 0.09% | 0.25% | 0.22% | -0.01% | |
| JPY | 0.22% | 0.21% | 0.16% | 0.24% | 0.33% | 0.13% | 0.13% | |
| CAD | 0.06% | -0.08% | -0.09% | -0.24% | 0.10% | 0.10% | -0.08% | |
| AUD | -0.04% | -0.24% | -0.25% | -0.33% | -0.10% | 0.06% | -0.23% | |
| NZD | -0.08% | -0.21% | -0.22% | -0.13% | -0.10% | -0.06% | -0.17% | |
| CHF | 0.14% | -0.01% | 0.00% | -0.13% | 0.08% | 0.23% | 0.17% |
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).
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.
- GBP/JPY drifts lower on Tuesday and snaps a three-day winning streak to the YTD peak.
- BoJ rate hike bets benefit the JPY and exert some downward pressure on spot prices.
- Traders look to the UK jobs data for a short-term impetus ahead of key central bank events.
The GBP/JPY cross attracts some selling during the Asian session on Tuesday and for now, seems to have snapped a four-day winning streak to its highest level since July 2024, around the 200.75 region, touched the previous day. Spot prices, however, manage to hold above the 200.00 psychological mark as traders look forward to the UK employment details for a fresh impetus ahead of the key central bank events.
The UK jobs report, along with Consumer Price Index (CPI) on Wednesday, could offer critical insight into the trajectory of inflation and its wider implications on monetary policy. A stronger-than-expected CPI print could further reduce the odds for an immediate interest rate cut by the Bank of England (BoE), which is scheduled to announce its policy decision on Thursday. This, in turn, could provide a goodish lift to the British Pound (GBP) and assist the GBP/JPY cross to attract some dip-buyers at lower levels.
Ahead of the key data, a broadly firmer Japanese Yen (JPY) exerts some downward pressure on spot prices. Despite domestic political turmoil, investors seem convinced that the Bank of Japan (BoJ) will stick to its policy normalization path, which, in turn, is seen as a key factor underpinning the JPY. That said, the uncertainty over the likely timing and the pace of rate hikes by the BoJ might cap gains for the JPY and help limit deeper losses for the GBP/JPY cross.
Furthermore, the prevalent risk-on environment – as depicted by a generally positive mood around the equity markets – could offer some support to the currency pair. Hence, it will be prudent to wait for strong follow-through selling before confirming that the GBP/JPY cross has topped out in the near-term and positioning for any meaningful corrective decline.
(The story was corrected on September 16 at 05:39 GMT, to say in the title, the third bullet point and the first paragraph that traders now look to UK jobs data, and not UK CPI.)
Economic Indicator
Consumer Price Index (YoY)
The United Kingdom (UK) Consumer Price Index (CPI), released by the Office for National Statistics on a monthly basis, is a measure of consumer price inflation – the rate at which the prices of goods and services bought by households rise or fall – produced to international standards. It is the inflation measure used in the government’s target. The YoY reading compares prices in the reference month to a year earlier. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish.
Read more.Next release: Wed Sep 17, 2025 06:00
Frequency: Monthly
Consensus: 3.9%
Previous: 3.8%
Source: Office for National Statistics
The Bank of England is tasked with keeping inflation, as measured by the headline Consumer Price Index (CPI) at around 2%, giving the monthly release its importance. An increase in inflation implies a quicker and sooner increase of interest rates or the reduction of bond-buying by the BOE, which means squeezing the supply of pounds. Conversely, a drop in the pace of price rises indicates looser monetary policy. A higher-than-expected result tends to be GBP bullish.
- EUR/USD appreciates ahead of Eurozone Industrial Production and the German ZEW Economic Sentiment survey.
- The Euro gains on hawkish comments from the ECB officials.
- Traders expect the Fed to lower rates by 25 basis points in September.
EUR/USD extends its winning streak for the fourth consecutive session, trading around 1.1780 during the Asian hours on Tuesday. The pair appreciates as the Euro (EUR) gains ground ahead of seasonally adjusted Eurozone Industrial Production figures for July and German ZEW Survey Economic Sentiment data for September.
The Euro draws support against its peers from hawkish European Central Bank (ECB) commentary. European Central Bank (ECB) board member Isabel Schnabel said on Tuesday that interest rates in the Eurozone are in a good place and added that upside risks to inflation continue to dominate. Schnabel said the growth is likely to exceed the potential, with domestic demand counteracting falling exports.
ECB policymaker Peter Kazimir said Monday that policy should not be adjusted over “small deviations” from the inflation target, while warning of upside risks to inflation. Kazimir added that interest rates have been brought into neutral territory.
The EUR/USD pair advanced as the US Dollar (USD) weakened on rising expectations that the Federal Reserve (Fed) will cut rates by 25 basis points at its September meeting on Wednesday. Markets are also assigning a slim probability to a larger 50-basis-point cut, while pricing in continued easing through 2026 to counter the risk of recession.
Traders will likely observe the Fed’s Summary of Economic Projections (SEP), the ‘dot plot,’ where each member of the Federal Open Market Committee (FOMC) expects the federal funds rate in the near future.
Euro FAQs
The Euro is the currency for the 19 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
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