Australian Dollar Rallies as RBA’s Hauser Sounds a Note of Caution
Australian Dollar (AUD) rose against the US Dollar (USD) on Monday, marking its second straight session of gains. The AUD/USD pair climbed after Reserve Bank of Australia (RBA) Deputy Governor Andrew Hauser warned that Australia’s recovery is unusually tight—demand is already above potential output—leaving little room to ease policy without stoking inflation. Hauser stressed that monetary conditions must remain restrictive to keep price pressures in check.
Additional support for the AUD came from signs of easing US–China trade tensions. China’s Ministry of Commerce announced it will temporarily lift its export ban on certain “dual-use” materials (including gallium, germanium, antimony and super-hard materials) destined for the United States. The suspension starts immediately and runs until November 27, 2026, Reuters reported. Since China is Australia’s largest trading partner, any improvement in Chinese trade relations tends to buoy the AUD.
In China’s latest data, consumer price inflation accelerated to a 0.2% year-on-year gain in October (after a 0.3% drop in September), beating market forecasts of flat prices. On a monthly basis, CPI rose 0.2%. Meanwhile, producer prices fell 2.1% year-on-year, a slight improvement on September’s 2.3% decline and marginally above expectations.
US Dollar Holds Steady amid Hopes of Shutdown Deal
The US Dollar Index (DXY), which tracks the USD against six major currencies, traded near 99.60. A Bloomberg report indicated a bipartisan group of Senate Democrats may support a stopgap spending plan to reopen parts of the federal government and extend funding for some agencies through early next year. That deal would also provide back pay to furloughed employees.
Treasury Secretary Janet Yellen warned that the shutdown is already harming the economy and could worsen. Meanwhile, Michigan’s Consumer Sentiment Index dropped to 50.3 in November—the lowest since June 2022—on worries over the impasse. Corporate job cuts jumped to over 153,000 in October, the largest October reduction in more than two decades, according to the Challenger report. On the brighter side, ADP’s private payrolls survey showed a gain of 42,000 jobs in October, outpacing expectations. The US ISM Services PMI rose to 52.4, also beating forecasts.
China’s October trade surplus narrowed slightly to CNY 640.4 billion, as exports fell 0.8% year-on-year and imports rose 1.4%. In dollar terms, the surplus was USD 90.07 billion, below the USD 95.6 billion analysts expected. China’s non-manufacturing PMI eased to 52.6, while manufacturing PMI slipped to 50.6.
Back home, Australia’s trade surplus widened to AUD 3.938 billion in September—well above forecasts—after exports jumped 7.9% month-on-month and imports rose 1.1%.
Technical Outlook: AUD/USD Eyes the 50-Day EMA
On the daily chart, AUD/USD hovered around 0.6520, consolidating within a horizontal range. The pair sits just above its nine-day Exponential Moving Average (EMA), suggesting a bullish short-term bias. The first hurdle is the 50-day EMA near 0.6535. A decisive break there could propel the pair toward the top of the range, around 0.6630, and potentially test the 13-month peak of 0.6707 (set in mid-September). Support sits at the 0.6500 psychological mark, then 0.6470 (the lower boundary of the rectangle), with further downside at 0.6414 (August low) and 0.6372 (six-month low).
Currency Movements Today (AUD as base; percentage change)
USD EUR GBP JPY CAD NZD CHF USD — +0.08% +0.12% +0.28% +0.02% +0.09% +0.18%
EUR –0.08% — +0.05% +0.20% –0.06% +0.03% +0.10%
GBP –0.12% –0.05% — +0.16% –0.10% –0.01% +0.05%
JPY –0.28% –0.20% –0.16% — –0.23% –0.16% –0.08%
CAD –0.02% +0.06% +0.10% +0.23% — +0.07% +0.16%
AUD +0.24% +0.32% +0.35% +0.50% +0.27% — +0.43%
NZD –0.09% –0.03% +0.01% +0.16% –0.07% –0.34% —
CHF –0.18% –0.10% –0.05% +0.08% –0.16% –0.43% –0.08% —
Today the Australian Dollar was strongest versus the Japanese Yen and weakest against the US Dollar.
