Australian Dollar holds firm on US-Iran ceasefire optimism
Ni Lallalit Srijandorn
Na-update: 6 Apr 2026
Sikat na Artikulo
The AUD/USD pair gathers strength around 0.6910 during the early European trading hours on Monday. Hopes for a US-Iran ceasefire provide some support to the riskier asset, such as the Australian Dollar (AUD) against the Greenback.
- AUD/USD holds positive ground near 0.6910 in Monday’s early European session.
- The US, Iran and regional mediators are discussing a potential 45-day ceasefire.
- US NFP rose more than expected last month, and the Unemployment Rate fell to 4.3%.
The AUD/USD pair gathers strength around 0.6910 during the early European trading hours on Monday. Hopes for a US-Iran ceasefire provide some support to the riskier asset, such as the Australian Dollar (AUD) against the Greenback. The US March ISM Services Purchasing Managers Index (PMI) report will be released later on Monday.
The US, Iran and regional mediators are talking about a potential 45-day ceasefire that could lead to a permanent end to the war, per Bloomberg, citing Axios. The people, who were not named, said the chances of reaching a deal over the next 48 hours are low. The report quoted US President Donald Trump as saying that the US is in deep negotiations with Iran and a deal is likely before his Tuesday deadline.
The stronger-than-expected US jobs data has bolstered bets that the US Federal Reserve (Fed) will maintain high rates, which could lift the US Dollar (USD) and create a headwind for the pair. The US economy added 178,000 jobs in March, versus a 133,000 decline (revised from -92,000) prior, according to the US Bureau of Labor Statistics (BLS) on Friday. This reading came in better than the forecast of a 60,000 gain. The Unemployment Rate edged lower to 4.3% in March, though that was largely from a sharp reduction in the labor force.
The Reserve Bank of Australia (RBA) raised the Official Cash rate (OCR) to 4.10% at its March meeting to combat sticky inflation. Market expectations for the May meeting lean toward another potential rate hike due to rising oil prices and a tight labor market. Westpac analysts anticipate the Australian central bank will deliver three further rate hikes in 2026. This would take the cash rate to 4.85%, a level not seen since November 2008.
Australian Dollar FAQs
One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD.
The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive.
China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs.
Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD.
The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.
Higit sa isang milyong user ang umaasa sa FXStreet para sa real-time market data, charting tools, expert insights, at Forex news. Ang komprehensibong economic calendar at educational webinars nito ay tumutulong sa mga trader na manatiling may alam at gumawa ng kalkuladong mga desisyon. Sinusuportahan ang FXStreet ng humigit-kumulang 60 propesyonal sa pagitan ng Barcelona HQ at iba’t ibang rehiyon sa buong mundo.
Magbasa pa
