During Monday’s European trading session, the AUD/USD pair advanced 0.25%, rising to near the 0.6700 level. The Australian Dollar’s strength is primarily driven by broad weakness in the US Dollar, which is under pressure amidst escalating tensions between the US and the EU during an extended holiday weekend in American markets. At the time of writing, the US Dollar Index (DXY) is down 0.2% around 99.20.
US-EU relations have become turbulent following President Donald Trump’s Saturday announcement of 10% tariffs on the UK and several EU members. Trump warned these tariffs could increase to 25% if Europe opposes Washington’s desire to purchase Greenland—an acquisition the US argues is necessary for national security and world peace.
In response to these threats, Greenland Prime Minister Jens-Frederik Nielsen stated on Monday that the US statements will not pressure his country, Reuters reported. Furthermore, the German ministry labeled the tariff threats “unacceptable” and expressed determination to respond with counter-tariffs.
Meanwhile, the Australian Dollar remains broadly stable against other currencies as investors await crucial December employment data due on Thursday. Expectations are for the Australian economy to have added 30K jobs, recovering from a loss of 21.3K in November. The unemployment rate, however, is projected to rise slightly from 4.3% to 4.4%
