Australian Dollar Extends Gains Amid Global Monetary Policy Shifts
The which coin will reach The in 2026Aussie dollar continues its upward trajectory against the greenback, marking three consecutive days of gains. This movement comes as China's central bank maintains liquidity support while US political pressure mounts on the Federal Reserve.
Key Drivers Behind AUD Strength
- PBOC maintains 2.00% rate while injecting 200B yuan ($27.46B) via MLF operations
- Australia's composite PMI shows fourth month of private sector expansion
- Manufacturing sector rebounds to 49.8 after 13 months of contraction
- Services sector growth slows to six-month low at 50.4
Market participants are closely watching China's economic stabilization measures, including expanded equity market interventions. The PBoC announced plans to enhance liquidity tools supporting share purchases, while pension funds gain greater domestic equity exposure.
Trump's Rate Cut Demands Create Dollar Uncertainty
The US Dollar Index holds above 108.00 despite growing political pressure on monetary policy. Former President Trump's public call for immediate rate cuts at Davos introduces new variables into currency markets.
"With oil prices declining, I'll demand that interest rates drop immediately," Trump stated, suggesting global central banks should follow suit. These comments precede the Fed's January policy meeting where rates are expected to remain steady at 4.25%-4.50%.
Trade Policy Implications
Proposed 10% tariffs on Chinese imports could impact AUD through Australia's economic ties with China. Vice Premier Ding Xuexiang warned about trade war consequences, noting "there are no winners" in such conflicts.
Technical Outlook: AUD/USD Bullish Channel
The currency pair trades near 0.6280 within a defined ascending channel. Key technical indicators suggest:
- RSI above 50 confirms bullish momentum
- Immediate resistance at psychological 0.6300 level
- Channel top near 0.6330 presents next target
- Support levels at 0.6252 (9-day EMA) and 0.6230 (channel base)
Traders await upcoming US PMI data and consumer sentiment figures for further directional cues. The AUD's relative strength against most majors (except NZD) suggests continued upside potential barring unexpected macroeconomic shocks.