The Australian Dollar (AUD) rises against the US Dollar (USD) on Monday, following three days of losses. The AUD/USD pair advances as the Greenback weakens, potentially amid concerns surrounding the Federal Reserve.
Federal prosecutors have opened a criminal investigation into Fed Chair Jerome Powell regarding the central bank’s renovation of its Washington headquarters and whether Powell lied to Congress about the project’s scope, the New York Times reported on Sunday.
ANZ Job Advertisements declined 0.5% in December, following an upwardly revised 1.5% drop in the prior month. Meanwhile, household spending increased 1.0% month-on-month in November 2025, easing from a revised 1.4% rise in October, as consumers remained cautious amid elevated interest rates and persistent inflation.
Australia’s mixed November Consumer Price Index (CPI) left the Reserve Bank of Australia’s (RBA) policy outlook uncertain. However, RBA Deputy Governor Andrew Hauser said that the November inflation data was largely as expected. Hauser added that interest rate cuts are unlikely anytime soon. Focus now shifts to the quarterly CPI report due later this month for clearer guidance on the RBA’s next policy move.
US Dollar declines due to Fed concerns
- The US Dollar Index (DXY), which measures the value of the US Dollar against six major currencies, is losing ground and trading around 98.90 at the time of writing. The Greenback struggles amid dovish Federal Reserve (Fed) expectations. December’s slower-than-expected US jobs growth suggests the US central bank could hold interest rates steady later this month.
- US Nonfarm Payrolls (NFP) rose by 50,000 in December, falling short of November’s 56,000 (revised from 64,000) and came in weaker than the market expectation of 60,000. However, the Unemployment Rate ticked lower to 4.4% in December from 4.6% in November, while the Average Hourly Earnings climbed to 3.8% YoY in December from 3.6% in the previous reading.
- According to the CME Group’s FedWatch tool, Fed funds futures continue to price in about a 95% probability that the US central bank will keep rates unchanged at its January 27–28 meeting.
- Richmond Fed President Tom Barkin said the decline in the unemployment rate was welcome and described job growth as modest but stable. Barkin added that it is difficult to find firms outside healthcare or AI that are hiring and said it remains unclear whether the labor market will tilt toward more hiring or more firing.
- US Treasury Secretary Scott Bessent said in a CNBC interview on Thursday that the Federal Reserve should continue cutting rates, arguing that lower rates are “the only ingredient missing” for even stronger economic growth and that the Fed should not delay.
- The US Department of Labor (DOL) reported on Thursday that Initial Jobless Claims rose modestly to 208,000 in the week ended January 3, slightly below market expectations of 210,000 but above the previous week’s revised 200,000. Continuing jobless claims increased to 1.914 million from 1.858 million, indicating a gradual rise in the number of people remaining on unemployment benefits.
- The Institute for Supply Management (ISM) reported on Wednesday that the US Services PMI rose to 54.4 in December from 52.6 in November. This figure came in stronger than the expectations of 52.3.
- The US Automatic Data Processing (ADP) Employment Change showed an increase of 41,000 jobs in December, following a revised decline of 29,000 in November. The figure came in slightly below market expectations of 47,000. JOLTS Job Openings came in at 7.146 million in November. This reading followed the 7.449 million openings recorded in October (revised from 7.67 million) and came in below the market expectations of 7.6 million.
- China’s Consumer Price Index (CPI) rose 0.8% year-over-year (YoY) in December, up from 0.7% in November but below the 0.9% forecast. On a monthly basis, CPI increased 0.2%, reversing November’s -0.1% reading. Meanwhile, China’s Producer Price Index (PPI) fell 1.9% YoY in December, improving from a 2.2% decline previously and slightly beating expectations of a -2.0% print.
- The Australian Bureau of Statistics (ABS) reported last week that Australia’s Trade Surplus narrowed to 2,936M MoM in November, versus 4,353M (revised from 4,385M) in the previous reading. Exports fell by 2.9% MoM in November from a rise of 2.8% (revised from 3.4%) seen a month earlier. Meanwhile, Imports grew by 0.2% MoM in November, compared to a rise of 2.4% (revised from 2.0%) seen in October.
Australian Dollar rebounds toward ascending channel near 0.6700
AUD/USD is trading around 0.6700 on Monday. Daily chart analysis shows the pair attempting a rebound toward an ascending channel, signaling a renewed bullish bias. The 14-day Relative Strength Index (RSI) at 58.33 remains above the midpoint, supporting upside momentum.
A sustained move back inside the channel would strengthen the bullish bias and support AUD/USD toward 0.6766, its highest level since October 2024. Further gains could see the pair test the upper boundary of the ascending channel near 0.6860.
The immediate support lies at the nine-day Exponential Moving Average (EMA) of 0.6700, followed by the 50-day EMA at 0.6631. Further losses would open the downside toward 0.6414, the lowest since June 2025.
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 Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.21% | -0.15% | 0.09% | -0.14% | -0.10% | -0.19% | -0.24% | |
| EUR | 0.21% | 0.06% | 0.28% | 0.08% | 0.10% | 0.01% | -0.03% | |
| GBP | 0.15% | -0.06% | 0.23% | 0.00% | 0.04% | -0.06% | -0.10% | |
| JPY | -0.09% | -0.28% | -0.23% | -0.22% | -0.19% | -0.27% | -0.32% | |
| CAD | 0.14% | -0.08% | -0.01% | 0.22% | 0.04% | -0.05% | -0.10% | |
| AUD | 0.10% | -0.10% | -0.04% | 0.19% | -0.04% | -0.09% | -0.14% | |
| NZD | 0.19% | -0.01% | 0.06% | 0.27% | 0.05% | 0.09% | -0.05% | |
| CHF | 0.24% | 0.03% | 0.10% | 0.32% | 0.10% | 0.14% | 0.05% |
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).
RBA FAQs
The Reserve Bank of Australia (RBA) sets interest rates and manages monetary policy for Australia. Decisions are made by a board of governors at 11 meetings a year and ad hoc emergency meetings as required. The RBA’s primary mandate is to maintain price stability, which means an inflation rate of 2-3%, but also “..to contribute to the stability of the currency, full employment, and the economic prosperity and welfare of the Australian people.” Its main tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will strengthen the Australian Dollar (AUD) and vice versa. Other RBA tools include quantitative easing and tightening.
While inflation had always traditionally been thought of as a negative factor for currencies since it lowers the value of money in general, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Moderately higher inflation now tends to lead central banks to put up their interest rates, which in turn has the effect of attracting more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in the case of Australia is the Aussie Dollar.
Macroeconomic data gauges the health of an economy and can have an impact on the value of its currency. Investors prefer to invest their capital in economies that are safe and growing rather than precarious and shrinking. Greater capital inflows increase the aggregate demand and value of the domestic currency. Classic indicators, such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can influence AUD. A strong economy may encourage the Reserve Bank of Australia to put up interest rates, also supporting AUD.
Quantitative Easing (QE) is a tool used in extreme situations when lowering interest rates is not enough to restore the flow of credit in the economy. QE is the process by which the Reserve Bank of Australia (RBA) prints Australian Dollars (AUD) for the purpose of buying assets – usually government or corporate bonds – from financial institutions, thereby providing them with much-needed liquidity. QE usually results in a weaker AUD.
Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the Reserve Bank of Australia (RBA) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the RBA stops buying more assets, and stops reinvesting the principal maturing on the bonds it already holds. It would be positive (or bullish) for the Australian Dollar.
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