The Australian dollar expands against the USD as tariff issues counteract divergences between the RBA and the Fed

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The AUD/USD pair is consolidating in a tight band around the mid-0.7000 mark during Tuesday’s Asian session and appears to have halted the previous day’s modest pullback from a more than one-week high for now. However, spot prices remain subdued at the price range of more than a week ago as investors prefer to wait for Wednesday’s monthly Australian consumer inflation data before making novel directional bets.

The key data will be the first test of the Reserve Bank of Australia’s (RBA) hawkish stance following a 25 basis point (bp) interest rate hike earlier this month, and will play a key role in influencing the Australian dollar (AUD). Meanwhile, renewed trade uncertainty continues to weigh on investor sentiment, which, together with the moderate rise in the US dollar (USD), weighs on the AUD/USD pair.

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However, concerns about the economic impact of US President Donald Trump’s introduction of a novel 15% global stamp duty and the expectation that the US Federal Reserve (Fed) will cut borrowing costs at least twice this year could limit the positive impact on the USD. Moreover, the Fed’s dovish outlook indicates a significant divergence from bets on another rate hike by the RBA in 2026, which could support the AUD/USD pair.

Therefore, it may be prudent to wait for a break from near-term trading range support and acceptance below the psychological 0.7000 mark before confirming that spot prices have peaked. Traders are now eagerly awaiting the U.S. economic report – which includes the Conference Board’s consumer confidence index and the Richmond manufacturing PMI – for a boost later in the North American session.

Today’s US dollar price

The table below shows the current percentage change of the United States Dollar (USD) against the major listed currencies. The US dollar was strongest against the Japanese yen.

USD EUR GBP JPY BOOR AUD NZD CHF
USD 0.06% 0.01% 0.14% 0.04% -0.02% -0.06% 0.14%
EUR -0.06% -0.04% 0.11% -0.02% -0.08% -0.12% 0.08%
GBP -0.01% 0.04% 0.15% 0.02% -0.03% -0.07% 0.13%
JPY -0.14% -0.11% -0.15% -0.10% -0.16% -0.21% -0.00%
BOOR -0.04% 0.02% -0.02% 0.10% -0.06% -0.10% 0.10%
AUD 0.02% 0.08% 0.03% 0.16% 0.06% -0.04% 0.16%
NZD 0.06% 0.12% 0.07% 0.21% 0.10% 0.04% 0.20%
CHF -0.14% -0.08% -0.13% 0.00% -0.10% -0.16% -0.20%

The heat map shows the percentage changes of the major currencies relative to each other. The base currency is selected from the left column and the quote currency from the top row. For example, if you select the US dollar from the left column and move along the horizontal line to the Japanese yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

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