Australia’s budget measures, including fuel excise relief and tax cuts, helped stabilize the AUD after April CPI data weighed on sentiment.
AUD/USD erased early losses on Tuesday, closing nearly flat after Treasurer Jim Chalmers unveiled a budget targeting oil shock fallout and cost-of-living pressures. The pair swung between gains and losses, peaking near 0.7210 before recovering most of its intraday decline by the North American close.
The budget included extended fuel excise relief, tax cuts for low- and middle-income earners starting in July, and savings from the National Disability Insurance Scheme. Earlier, April business conditions fell to 3 from 6, while confidence remained deeply negative at -24, signaling persistent economic strain.
Markets now await Australia’s Q1 Wage Price Index, expected at 0.8% QoQ, as a key inflation indicator. US CPI accelerated to 3.8% YoY in April, exceeding forecasts and adding to global inflation concerns.