AUD/USD remains below 0.6700/200-day SMA, moves little after Chinese inflation data

AUD/USD remains below the 200-day SMA through the Asian session on Monday.
The emergence of some USD buying turns out to be a key factor capping the pair.
China’s economic woes also contribute to keeping a lid on the China-proxy Aussie.

Haresh Menghani FXStreet

The AUD/USD pair struggles to capitalize on Friday's strong positive move and remains below the 0.6700 mark, or a technically significant 200-day Simple Moving Average (SMA) through the Asian session on Monday.

The prospects for further policy tightening by the Federal Reserve (Fed) later this month remain supportive of elevated US Treasury bond yields and assist the US Dollar (USD) to attract some buyers on the first day of a new week. In fact, the USD Index (DXY), which tracks the Greenback against a basket of currencies, recovers a part of Friday's heavy losses to a fresh monthly low and turns out to be a key factor acting as a headwind for the AUD/USD pair.

That said, reduced bets for any further interest rate hike by the Fed after the one expected in July might hold back traders from positioning for any meaningful upside for the USD. Investors seem convinced that the US central bank will soften its hawkish stance sooner rather than later and the expectations were fueled by the rather unimpressive US jobs report on Friday, which showed that the economy added the fewest jobs in 2-1/2 years in June.

The aforementioned fundamental backdrop suggests that the path of least resistance for the AUD/USD pair is to the upside, though China’s economic woes continue to act as a headwind for the China-proxy Aussie. The worries were fueled by softer Chinese inflation figures, which showed that the headline CPI fell 0.2% in June and the yearly rate remained flat. Moreover, the Producer Price Index (PPI) fell by the 5.4% YoY rate during the reported month.

In the absence of any relevant market-moving economic releases from the US, traders on Monday will take cues from a speech by Fed Governor Michael Barr. This, along with the US bond yields, might influence the USD and provide some impetus to the AUD/USD pair. The focus, however, remains glued to this week's release of the latest US consumer inflation figures, due on Wednesday, which will play a key role in driving the USD demand in the near term.

Technical levels to watch

AUD/USD

Overview
Today last price	0.6695
Today Daily Change	0.0004
Today Daily Change %	0.06
Today daily open	0.6691

Trends
Daily SMA20	0.6726
Daily SMA50	0.6677
Daily SMA100	0.6687
Daily SMA200	0.6697

Levels
Previous Daily High	0.6701
Previous Daily Low	0.662
Previous Weekly High	0.6705
Previous Weekly Low	0.6599
Previous Monthly High	0.69
Previous Monthly Low	0.6484
Daily Fibonacci 38.2%	0.667
Daily Fibonacci 61.8%	0.6651
Daily Pivot Point S1	0.664
Daily Pivot Point S2	0.6589
Daily Pivot Point S3	0.6559
Daily Pivot Point R1	0.6722
Daily Pivot Point R2	0.6752
Daily Pivot Point R3	0.6803

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

AUD/USD bulls seem hesitant below 0.7050 ahead of RBA on Tuesday

AUD/USD reverses an Asian session dip on Monday as renewed optimism over Iran diplomacy boosts investor confidence, keeping a lid on the safe-haven US Dollar and supporting the risk-sensitive Aussie. Spot prices, however, remain below the one-month high, touched last Thursday, as bulls wait for the crucial RBA decision before taking fresh positions.

USD/JPY climbs to 158.00 neighborhood as BoJ uncertainty weighs on the JPY

The USD/JPY pair gains some positive traction at the start of a new week, recovering further from Friday's post-Bank of Japan (BoJ) swing low to sub-157.00 levels. The momentum lifts spot prices to the 158.00 neighborhood during the Asian session and seems unaffected by fresh intervention warning from Japan's Finance Minister Satsuki Katayama.

Gold recovers on positive US-Iran headlines

Gold extends its recovery during American trading hours on Monday, supported by falling Oil prices following positive headlines on US-Iran talks. The metal regains ground after hitting a fresh yearly low of $3,870 on Friday and ending October down 6.87%. However, the rebound lacks conviction as the fundamental backdrop continues to raise doubts over a sustained recovery.

Bitcoin braces for US midterm elections as historical sell-offs revive downside concerns

Bitcoin (BTC) braces for the impact of the US midterm elections, just a week after the $6 billion hack from Binance. Historically, congressional elections have negatively affected not just the president’s party but also Bitcoin. In the last 22 midterms, the ruling party has gained House seats only twice, while the three most recent elections coincided with Bitcoin’s bear market bottoms.

Why strong US growth could not stop the bond rally and AI selloff

The US economy grew at a 3.4% annual rate, yet Treasury yields fell and the Nasdaq ended October with its worst monthly performance since March 2025. The market is no longer rewarding capital expenditure simply because it supports growth. Investors are testing whether that expenditure can produce cash flow and returns above the cost of capital.

The 2% inflation target came from a throwaway remark. It now moves trillions

The Federal Reserve's 2% inflation goal grew out of an off-the-cuff remark by a New Zealand politician in 1988. Bond investors still price long-term US debt as if 2% holds, so a change in how the Fed measures inflation would move markets.