AUD/USD holds steady below 0.6650, highest since September ahead of China's trade data

AUD/USD kicks off the new week on a subdued note ahead of key central bank event risks.
The divergent RBA-Fed policy expectations continue to act as a tailwind for spot prices.
Traders now look forward to China’s Trade Balance data to grab short-term opportunities.

Haresh Menghani FXStreet

The AUD/USD pair enters a bullish consolidation phase at the start of a new week and oscillates in a narrow range near its highest level since September 16, touched on Friday. Spot prices currently trade around the 0.6640 region as traders look to China's Trade Balance data for some impetus ahead of this week's key central bank event risks.

The Reserve Bank of Australia (RBA) is scheduled to announce its policy decision on Tuesday and is widely expected to leave interest rates unchanged and keep focus on taming inflation. In fact, RBA Governor Michele Bullock admitted last week that inflation is not yet sustainably back within the central bank's 2% to 3% annual target band. Furthermore, Australia's economy grew at its fastest annual pace in two years, which, along with a strong labour market, fueled speculations that the RBA will instead hike interest rates next year. This marks a significant divergence in comparison to dovish US Federal Reserve (Fed) expectations, which keeps the US Dollar (USD) bulls on the defensive and acts as a tailwind for the AUD/USD pair.

The recent US macro data pointed to a gradual cooling of the economy, which, along with comments from several Fed officials, suggests that another interest rate cut in December is all but certain. According to the CME Group's FedWatch Tool, traders are currently pricing in a nearly 90% chance that the US central bank will cut interest rates by 25-basis-points (bps) on Wednesday. Traders, however, opt to wait for more cues about the Fed's rate-cut path before placing fresh directional bets, which, in turn, leads to the AUD/USD pair's subdued price action during the Asian session. Hence, the market focus will remain glued to the updated economic projections and Fed Chair Jerome Powell's comments during the post-meeting press conference.

In the meantime, China's Trade Balance data could provide some impetus to the Australian Dollar (AUD) and the currency pair. Nevertheless, the aforementioned fundamental backdrop seems tilted firmly in favor of bullish traders and suggests that the path of least resistance for the AUD/USD pair remains to the upside. Hence, any meaningful corrective pullback could be seen as a buying opportunity and is more likely to remain cushioned.

Economic Indicator

Trade Balance CNY

The Trade Balance released by the General Administration of Customs of the People’s Republic of China is a balance between exports and imports of total goods and services. A positive value shows trade surplus, while a negative value shows trade deficit. It is an event that generates some volatility for the CNY. As the Chinese economy has influence on the global economy, this economic indicator would have an impact on the Forex market. In general, a high reading is seen as positive (or bullish) CNY, while a low reading is seen as negative (or bearish) for the CNY.

EUR/USD gathers traction, approaches 1.1800

EUR/USD manages to reverse Tuesday’s pullback, advancing to two-day highs near the 1.1800 hurdle in the latter part of Wednesday’s session. The pair’s decent uptick comes on the back of the modest retracement in the US Dollar, as investors continue to closely follow developments on the trade front and news from the White House in the wake of President Trump’s SOTU speech.

GBP/USD challenges multi-day highs near 1.3530

GBP/USD leaves behind the previous day’s decline and regains fresh upside traction on Wednesday, surpassing the 1.3500 barrier in a context of a modest decline in the Greenback and a generalised improved mood in the risk-linked space. Meanwhile, the US tariff narrative continues to dictate the mood among market participants after Presidet Trump’s SOTU speech failed to surprise markets.

Gold remains bid and close to $5,200

Gold buyers are returning to the fold on Wednesday, targeting the $5,200 area and possibly beyond, after Tuesday’s corrective dip from monthly highs. The rebound in the precious metal comes as the US Dollar loses traction, with Trump’s SOTU speech offering little fresh direction and AI-related nerves continuing to ease.

Crypto Today: Bitcoin, Ethereum, XRP test rebound strength as ETF inflows return

Bitcoin, Ethereum and Ripple are gaining traction at the time of writing on Wednesday, amid persistent market doldrums. The Crypto King is up over 2% intraday, trading above $65,000 from the day’s opening of $64,058.

Nvidia earnings to influence AI trade and broader market sentiment

For the last three years, Nvidia has been the engine of the AI boom, and now Wall Street is watching to see whether that momentum can keep going. High-growth stocks have been struggling to maintain their bullish trend in 2026.

Cosmos Hub Price Forecast: ATOM rebounds slightly, bearish outlook remains intact

Cosmos Hub (ATOM) price rebounds, trading above $2.05 at the time of writing on Wednesday, after undergoing a sharp correction since last week. Weakening on-chain and derivatives data support a bearish outlook, while technical analysis remains unfavorable.