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- AUD/USD attracts some buyers during the Asian session on Thursday amid a softer USD.
- Rising geopolitical tensions and Fed rate hike bets should help limit deeper USD losses.
- Diminishing odds of further tightening by the RBA also contribute to capping spot prices.
The AUD/USD pair recovers a few pips after touching a fresh two-month low during the Asian session on Thursday and moves back above the 0.7000 psychological mark. The fundamental backdrop, however, seems tilted in favor of bearish traders, making it prudent to wait for strong follow-through buying before confirming that spot prices have formed a near-term bottom.
Despite a rise in the headline US Consumer Price Index (CPI) in May, the milder core indicators eased worries about runaway inflation and kept the US Dollar (USD) bulls on the defensive. This, in turn, is seen as a key factor acting as a tailwind for the AUD/USD pair. Nevertheless, traders are still pricing in a 70% chance that the US Federal Reserve (Fed) will hike interest rates by the end of this year amid concerns about energy prices due to the Middle East conflict.
In fact, the US military launched a new wave of strikes on targets across Iran after President Donald Trump said that more were coming. In response, Iran announced the closure of the Strait of Hormuz and warned that its armed forces would give a crushing and decisive response to any aggression from the US in the region. The latest developments threaten to derail efforts to over three-month-old war, which should support Crude Oil prices and the safe-haven Greenback.
Apart from this, fading expectations of additional interest rate hikes by the Reserve Bank of Australia (RBA) might hold back traders from placing aggressive bullish bets around the Australian Dollar (AUD) and cap the AUD/USD pair. This, in turn, suggests that any subsequent move up might still be seen as a selling opportunity and runs the risk of fizzling out rather quickly. Traders now look to the US Producer Price Index (PPI) for a fresh impetus later today.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.12% | -0.09% | -0.05% | -0.05% | 0.04% | -0.08% | -0.18% | |
| EUR | 0.12% | 0.03% | 0.07% | 0.08% | 0.06% | 0.07% | -0.06% | |
| GBP | 0.09% | -0.03% | 0.06% | 0.04% | 0.04% | 0.04% | -0.09% | |
| JPY | 0.05% | -0.07% | -0.06% | -0.02% | -0.03% | -0.03% | -0.14% | |
| CAD | 0.05% | -0.08% | -0.04% | 0.02% | -0.01% | 0.00% | -0.14% | |
| AUD | -0.04% | -0.06% | -0.04% | 0.03% | 0.01% | 0.01% | -0.14% | |
| NZD | 0.08% | -0.07% | -0.04% | 0.03% | -0.00% | -0.01% | -0.13% | |
| CHF | 0.18% | 0.06% | 0.09% | 0.14% | 0.14% | 0.14% | 0.13% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).












