AUD/USD Holds Strong Near 0.7030 Amid RBA Hawkishness and Upbeat China Data The Australian Dollar continued its ascent against the US Dollar on Wednesday, building on a 1% gain from the previous session. Supporting the Aussie’s strength are robust PMI figures from both Australia and China. Australia’s Services PMI surged to 56.3—its highest since early 2022—while China’s Services PMI beat expectations at 52.3, signaling healthy demand from Australia’s largest trading partner.
Domestic policy remains a primary driver after the RBA hiked the cash rate to 3.85%. Governor Michele Bullock emphasized that “sticky” inflation is no longer acceptable, leading markets to price in an 80% chance of another hike in May. Conversely, the US Dollar Index (DXY) remains subdued near 97.40. Despite a resolution to the brief US government shutdown and a resilient manufacturing sector, investor caution prevails as they await US ISM Services data and digest Kevin Warsh’s nomination as the next Fed Chair
