AUD/USD declines as US Dollar firms, RBA policy meeting in focus
- The US ISM Manufacturing PMI drops to 48.7 in October, signaling ongoing contraction.
- Expectations for a December Fed rate cut ease, lending mild support to the US Dollar.
- Traders remain cautious ahead of the Reserve Bank of Australia’s policy meeting.
AUD/USD weakens on Monday, trading around 0.6530 at the time of writing, down 0.25% on the day. The Australian Dollar (AUD) pullback comes as the US Dollar (USD) finds modest support following the Federal Reserve’s (Fed) meeting last week, and despite the release of weaker US manufacturing data earlier in the day, while traders remain cautious ahead of the Reserve Bank of Australia (RBA) policy decision on Tuesday.
The US Institute for Supply Management’s (ISM) Manufacturing Purchasing Managers’ Index (PMI) fell to 48.7 in October, down from 49.1 in September and below market expectations of 49.5, dipping into contraction territory. Subcomponents of the report showed slight improvements in New Orders and Employment, while the Prices Paid Index dropped to 58, indicating easing cost pressures in the sector.
Despite the disappointing data, the US Dollar Index (DXY) holds slightly higher for the day as investors adjust their positions before the Fed’s December meeting. According to the CME FedWatch tool, markets now price a roughly 68% chance of a rate cut in December, down from over 90% a week earlier.
In Australia, traders remain cautious ahead of Tuesday’s RBA meeting, where policymakers are widely expected to keep the Official Cash Rate at 3.6% after three consecutive cuts earlier this year. Third-quarter inflation data came in hotter than expected, while RBA Governor Michele Bullock noted that the labor market remains tight, supporting a wait-and-see approach on policy.
Meanwhile, China’s manufacturing slowdown, with the Manufacturing PMI slipping to 50.6 in October, and renewed trade tensions between Washington and Beijing continue to cloud the regional outlook and weigh on the Aussie.
Australian Dollar Price Today
The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.23% | 0.24% | 0.06% | 0.45% | 0.37% | 0.38% | 0.43% | |
| EUR | -0.23% | 0.03% | -0.21% | 0.22% | 0.14% | 0.17% | 0.22% | |
| GBP | -0.24% | -0.03% | -0.18% | 0.19% | 0.13% | 0.14% | 0.21% | |
| JPY | -0.06% | 0.21% | 0.18% | 0.39% | 0.33% | 0.47% | 0.41% | |
| CAD | -0.45% | -0.22% | -0.19% | -0.39% | -0.10% | -0.05% | 0.00% | |
| AUD | -0.37% | -0.14% | -0.13% | -0.33% | 0.10% | 0.03% | 0.10% | |
| NZD | -0.38% | -0.17% | -0.14% | -0.47% | 0.05% | -0.03% | 0.06% | |
| CHF | -0.43% | -0.22% | -0.21% | -0.41% | -0.01% | -0.10% | -0.06% |
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 Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
Author
Ghiles Guezout
FXStreet
Ghiles Guezout is a Market Analyst with a strong background in stock market investments, trading, and cryptocurrencies. He combines fundamental and technical analysis skills to identify market opportunities.
