Australian dollar retreats as markets fear US tariffs

AUD/USD fell 0.20% to around 0.6200 on Friday.
Upbeat Chinese GDP did not offset dovish RBA signals.
Trump’s upcoming tariff plans are fueling cautious market sentiment.

AUD/USD returned to the negative territory near 0.6200 on Friday, failing to maintain momentum driven by stronger-than-expected Chinese economic indicators. Lingering expectations of lower Australian interest rates and concerns over possible US import tariffs are weighing on the pair.

Daily Market Change Summary: Aussie Continues to Feel Sell Pressure and Needs to Stay Above 0.6200

The US dollar is finding pockets of demand as investors cautiously approach President-elect Trump’s inauguration.
Markets anticipate that the novel administration may announce revised tariff initiatives, which could impact global trade and enhance U.S. inflation.
On the positive side for the Australian, China’s GDP grew by 5.4% y/y in the fourth quarter, exceeding forecasts of 5% and surpassing the previous 4.6%. However, the Australian dollar – a typical beneficiary of sturdy Chinese growth – is showing only modest support.
The RBA’s willingness to ease monetary policy combined with frail domestic sentiment leaves the Australian currency vulnerable to further declines despite a short-lived mid-week rebound.

AUD/USD Technical Outlook: Pair oscillates around 20-day SMA, sellers press

AUD/USD retreated 0.22% to 0.6200 on Friday, retreating from an earlier gain near a weekly high. The relative strength index (RSI) is oscillating at 43, dipping into the negative territory.

Meanwhile, the moving average convergence divergence (MACD) histogram continues to show rising green bars, indicating a measured bullish momentum. After briefly dropping below the 20-day uncomplicated moving average (SMA), the pair managed to climb above it again, suggesting some near-term support remains. However, persistent concerns about trade policy and the RBA’s cautious stance may limit attempts at gains in the coming sessions.