Above 0.7000: Australian Dollar stays near monthly high as USD recovers

Competing drivers leave AUD/USD without a clear intraday trend on Friday.
Hawkish RBA signals support the Aussie, but a modestly firmer USD limits advances.
Next week's FOMC meeting and key US economic releases take centre stage.

The rebound from below 0.7000 has struggled to gain traction. After bouncing on the previous day, AUD/USD fluctuates between small gains and losses in Friday's Asian session. Even so, the pair appears on course for a strong weekly advance. Supportive fundamentals keep it near the monthly high reached on Thursday.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Hawkish remarks from Reserve Bank of Australia (RBA) officials remain supportive of the Australian Dollar (AUD). Earlier this week, RBA Assistant Governor Christopher Kent said there were reasonable indications of rising neutral rates in Australia and globally. On Thursday, RBA Deputy Governor Andrew Hauser also warned that Q3 trimmed-mean inflation could exceed expectations. His comments sustain expectations of a rate increase ahead of the 3 November policy meeting.

4.5% year-on-year growth in China's third-quarter GDP provides further support for the Aussie. The better-than-expected reading compares with 4.3% in the second quarter. The US Dollar (USD), however, draws some buying interest and recovers modestly from Thursday's three-week low. That recovery discourages fresh bullish positions in AUD/USD, suggesting caution before positioning for a continuation of the week-long uptrend.

Around an 80% probability of another US rate increase in December remains priced in by traders, despite recent signals from Federal Reserve (Fed) officials that there is no urgency to raise rates. Concerns over oil-driven inflation also support the prospect of further Fed tightening. Meanwhile, escalating Middle East tensions and the US-Iran standoff sustain geopolitical uncertainty. Together, these factors revive demand for the safe-haven dollar and constrain AUD/USD's upside.

With traders seemingly reluctant to take fresh directional positions without clearer guidance on the Fed's policy trajectory, attention turns to the two-day FOMC meeting's outcome next Wednesday. Next week's Advance Q3 GDP release and Personal Consumption Expenditures (PCE) Price Index will also be important. These US data releases will help shape near-term USD movements and provide meaningful direction for AUD/USD.

AUD/USD Daily Price Chart

Technical Outlook

0.7033, the 100-day Simple Moving Average (SMA), continues to cap AUD/USD. A concentration of Fibonacci resistance adds to the pressure, spanning the 38.2% retracement at 0.7028 and the 50.0% level at 0.7069. Failure to regain this overhead resistance cluster leaves rebounds vulnerable, as sellers defend the downtrend originating at the 0.7242 swing high.

0.6977, the 23.6% Fibonacci retracement, provides initial downside support. Below that, the 0.6896 swing low marks a deeper floor, where stronger buying interest would be expected should the current decline continue.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

US Dollar: Today's Currency Performance

Against the Japanese Yen, the US Dollar (USD) recorded its strongest performance today. The table below sets out its percentage changes against the major currencies listed.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.03%	0.04%	0.11%	-0.01%	0.10%	-0.23%	0.07%
EUR	-0.03%		0.03%	0.07%	-0.04%	0.06%	-0.25%	0.05%
GBP	-0.04%	-0.03%		0.04%	-0.04%	0.03%	-0.27%	0.02%
JPY	-0.11%	-0.07%	-0.04%		-0.11%	-0.01%	-0.34%	-0.03%
CAD	0.00%	0.04%	0.04%	0.11%		0.11%	-0.23%	0.08%
AUD	-0.10%	-0.06%	-0.03%	0.01%	-0.11%		-0.32%	-0.02%
NZD	0.23%	0.25%	0.27%	0.34%	0.23%	0.32%		0.31%
CHF	-0.07%	-0.05%	-0.02%	0.03%	-0.08%	0.02%	-0.31%

Percentage movements between major currencies are displayed in the heat map. Select the base currency from the left-hand column and the quote currency from the top row. Selecting the US Dollar on the left and following that row across to the Japanese Yen, for instance, gives the percentage change for USD (base)/JPY (quote) in the corresponding cell.