AUD/USD: Upside looks somewhat limited, although the room for a rally later in the year should emerge – ING

FXStreet Insights Team FXStreet

The Reserve Bank of Australia (RBA) kept rates unchanged. Economists at ING analyze AUD/USD outlook.

A hawkish ‘skip’ by the RBA

The statement clearly leaves the door open for more tightening if required and reiterates a strictly data-dependent approach to further monetary policy decisions.

With a September rate hike almost fully priced in, we expect the pair to be almost entirely driven by external factors (Fed, US data, Chinese sentiment): for now, the upside looks somewhat limited, although the room for a rally later in the year should emerge.

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

EUR/USD edges lower below 1.1650 as Middle East tensions fuel US Dollar strength

The EUR/USD pair trades in negative territory around 1.1635 during the early Asian session on Thursday. The US Dollar strengthens against the Euro as escalating Middle East conflict boosts safe-haven flows. Traders brace for the Eurozone Retail Sales and US weekly Initial Jobless Claims reports, which will be released later on Thursday.

GBP/USD tests key moving averages as growth downgrade weighs

GBP/USD was nearly flat on Wednesday, edging up 0.08% to settle around 1.3370 in a quiet session. The pair has fallen sharply from its late-January high near 1.3870 and is now testing the 200-day Exponential Moving Average, with this week's one-week forex heatmap showing Pound Sterling as one of the worst performers against the US Dollar, down about 1.4% on the week.

Gold benefits from a retreating USD; reduced Fed rate cut bets cap gains

Gold attracts some buyers for the second consecutive day on Thursday amid a modest US Dollar pullback from an over three-month high, though it remains below the $5,200 mark. Wednesday's upbeat US macro data further tempered hopes for three rate cuts by the Fed in 2026. Furthermore, escalating Middle East tensions might continue to benefit the USD's status as the global reserve currency and contribute to capping the bullion.