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• AUD/USD softens to around 0.6215 in Friday’s early Asian session. 
• Fewer Fed rate cuts bets and Trump's policies continue to support the USD. 
• RBA’s Meeting Minutes revealed the board had grown more confident about inflation, but risks persisted.

The AUD/USD pair remains on the defensive around 0.6215 during the early Asian session on Friday. The incoming Donald Trump administration is expected to boost growth and lift inflation, supporting the US Dollar (USD). The markets are likely to be quiet ahead of next week’s New Year holiday.

The US Federal Reserve (Fed) decided to cut the interest rates by 25 basis points (bps) last week as expected, and Fed Chair Jerome Powell said more rate cuts now hinge on further progress in lowering stubbornly high inflation. Additionally, analysts expect that the potential new Trump tariff policies on trading partners could increase price pressures and slow the pace of rate reductions by the US central bank, which underpins the Greenback against the Australian Dollar (AUD). 

Data released by the US Department of Labor (DOL) on Thursday showed that the US Initial Jobless Claims declined to 219K in the week ending December 21. This reading followed the previous week's print of 220K and came in below the market consensus of 224K. 

On the Aussie front, the latest minutes of the Reserve Bank of Australia (RBA)’s monetary policy suggested the Australian central bank is more confident that inflation is moving sustainably toward the target. Nonetheless, it’s premature to conclude the battle is won due to a recent pick-up in household spending and a tight labor market. Analysts expect the RBA to start cutting rates only by the second quarter of 2025 in a shallow easing cycle.

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