AUD/USD Jumps To Near 0.6230 As US Dollar Tumbles, Upside Remains Capped
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- AUD/USD gains sharply to near 0.6230 as the US Dollar faces strong selling pressure.
- Fed dovish bets have escalated as US Personal Spending declined in January.
- The Australian Dollar would face selling pressure if Trump imposed additional 10% tariffs on China.
The AUD/USD pair climbs to near 0.6230 in North American trading hours on Monday. The Aussie pair gains as the US Dollar (USD) faces strong selling pressure after comments from United States (US) Commerce Secretary Howard Lutnick indicated that tariffs by President Donald Trump on Canada and Mexico could be lower than 25% as stated earlier.
The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, tumbles to near 106.80.
US Dollar PRICE Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.93% | -0.84% | 0.29% | -0.24% | -0.40% | -0.26% | -0.32% | |
| EUR | 0.93% | -0.02% | 1.00% | 0.50% | 0.43% | 0.49% | 0.43% | |
| GBP | 0.84% | 0.02% | 1.13% | 0.53% | 0.45% | 0.51% | 0.46% | |
| JPY | -0.29% | -1.00% | -1.13% | -0.30% | -0.63% | -0.48% | -0.60% | |
| CAD | 0.24% | -0.50% | -0.53% | 0.30% | -0.01% | -0.00% | -0.07% | |
| AUD | 0.40% | -0.43% | -0.45% | 0.63% | 0.00% | 0.07% | 0.00% | |
| NZD | 0.26% | -0.49% | -0.51% | 0.48% | 0.00% | -0.07% | -0.06% | |
| CHF | 0.32% | -0.43% | -0.46% | 0.60% | 0.07% | -0.00% | 0.06% |
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 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).
Over the weekend, Howard Lutnick said to Fox News that there are going to be “tariffs on Mexico and Canada on Tuesday” but we are going to leave that for the “President and his team to negotiate”.
Additionally, escalating Federal Reserve (Fed) dovish bets have also weighed on the US Dollar. The probability for the Fed to cut interest rates in the June policy meeting has increased to 74% from 63% a week ago, according to the CME FedWatch tool. Fed dovish bets have swelled due to a decline in the US Personal Spending data for January.
Meanwhile, the upside in the Aussie pair remains capped as Donald Trump is poised to impose additional 10% tariffs on China, alongwith his North American peers. The impact of Trump’s tariffs is also unfavorable for the Australian Dollar (AUD) knowing that Australian exports rely heavily on the Chinese economy.
Going forward, investors will focus on the Reserve Bank of Australia (RBA) minutes for the February meeting, which will be released on Tuesday. In February, the RBA reduced its Official Cash Rate (OCR) by 25 basis points (bps) to 4.10%. This was the first interest rate cut decision by the RBA since November 2020. RBA Governor Michele Bullock guided a cautious stance on further policy-easing as the battle against inflation is not over yet.
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