The Australian Dollar remains range-bound as competing hawkish signals from the Fed and RBA offset USD weakness.
AUD/USD traded little changed around 0.7011 on Friday, reflecting offsetting hawkish policy stances from the Federal Reserve and Reserve Bank of Australia. Both central banks held rates steady this week but left the door open for future hikes amid persistent inflation concerns, capping significant moves in the pair.
The pair is set for a weekly loss despite a modest pullback in the USD, supported partly by easing Middle East tensions. However, traders remain cautious ahead of key economic data, including Australia’s CPI and US PCE reports next week, which could influence rate expectations.
Technical analysis suggests a near-term bearish bias, with AUD/USD holding below its Bollinger middle band. The currency’s sensitivity to Chinese economic data, given Australia’s trade ties, adds another layer of uncertainty.