AUD Holds Steady as Geopolitical Tensions Rise

AUD

The Aussie Dollar opens slightly higher against the major currencies, as markets digested the RBA’s bullish Monetary Policy Meeting Minutes yesterday. On equities, the ASX closed +0.2%, Shanghai Comp -1.3% and Nikkei -0.4%. Commodities closed down overall, with the largest movers being Copper and Natural Gas -2.0%. Yesterday, the RBA mentioned that there was no set future path for interest rates, however they were worried about inflation. Today will have Wage Price Index q/q at 11:30am, expected to release at 0.8%, which will reveal how much of a pay rise Australian workers received on average in the December quarter of 2025. Tomorrow will have Employment Change (exp. 20K) and Unemployment Rate (exp. 4.2%) at 11:30am.

USD

The AUDUSD opens slightly higher at 0.7085, trading between 0.7028 and 0.7089 last night following US and Iran talks and a trilateral discussion between Russia, Ukraine and the US. Wall Street closed higher with the Dow Jones +0.3%, S&P500 +0.4% and Nasdaq +0.6%. Iran and the U.S. reached an understanding on the main "guiding principles" in a second round of indirect talks over their nuclear dispute, although a deal is not imminent, Iranian Foreign Minister Abbas Araqchi said. Overnight we had the Empire State Manufacturing release higher than expectations at 7.1 vs 6.4. Tonight will have Core Durable Goods Orders m/m (exp. +0.3%) and Durable Goods Orders m/m (exp. -1.8%). 

EUR

The AUDEUR opens slightly higher at 0.5977, trading sideways between 0.5952 and 0.5983 with minimal data this week. On equities, the DAX closed +0.8% and CAC +0.5%. No major economic data out of the Eurozone until Friday night; Flash Manufacturing and Service PMIs will be released. 
 

GBP

The AUDGBP opens higher at 0.5222, climbing from yesterday’s lows of 0.5179 due to last night’s Claimant Count Change. The figure released at 28.6K, instead of 22.8K as expected, which markets interpreted as a worrying sign for the British economy. Tonight will have CPI y/y, expected to release at 3.0% (down from previous reading of 3.4%).
 

NZD

The AUDNZD opens flat at 1.1714, trading sideways between 1.1681 and 1.1721. New Zealand has had minimal data this week, but today will have the RBNZ interest rate decision. Current expectations are that the RBNZ hold interest rates at 2.25%.