Australian Dollar gains ground due to risk-on mood, awaits Fed Powell testimony

The Australian Dollar advances as a ceasefire has been agreed upon between Iran and Israel.
The upbeat S&P Global Australia PMI data dampened expectations of the RBA cutting interest rates anytime soon.
Fed's Michelle Bowman stated that the time to cut interest rates is approaching.

Akhtar Faruqui FXStreet

The Australian Dollar (AUD) appreciates against the US Dollar (USD) on Tuesday, extending its gains for the second successive session. The AUD/USD pair gains ground after US President Donald Trump said a ceasefire has been agreed upon between Iran and Israel. Trump said that a "complete and total" ceasefire between Israel and Iran will go into effect to end the conflict between the two nations.

Iran fired missiles at the Al Udeid Air Base in Qatar on Monday. Qatar officials said that the missile barrage was intercepted and that the base had been evacuated in advance. Trump announced late Saturday that he had "obliterated" Iran's three nuclear facilities, including Fordow, Natanz, and Isfahan, in strikes overnight. Iranian parliament approved a measure to close the Strait of Hormuz.

The latest upbeat S&P Global Purchasing Managers Index (PMI) data revealed that Australia’s private sector grew at its second-fastest pace in ten months, weakening short-term rate cut expectations by the Reserve Bank of Australia (RBA).

Traders will likely observe Fed Chair Jerome Powell, who is scheduled to testify before the US Congress on Tuesday and Wednesday, in search of clues about the future direction of interest rates.

Australian Dollar appreciates as the US Dollar holds losses amid improved market sentiment

The US Dollar Index (DXY), which measures the value of the US Dollar against six major currencies, is trading at around 98.20 at the time of writing. The Greenback faced challenges following the dovish remarks from the Federal Reserve (Fed) officials.
Fed’s Vice Chair for Supervision Michelle Bowman noted on Monday that the time to cut interest rates is getting nearer as risks to the job market may be on the rise. Bowman also highlighted that inflation appears to be on a sustained path back to 2%, and she is less concerned that tariffs will cause an inflation problem.
Federal Reserve (Fed) Governor Christopher Waller noted on Friday that the US central bank could start easing monetary policy as soon as next month, signaling flexibility amid global economic uncertainty and rising geopolitical risks.
The US Fed decided to keep the interest rate steady at 4.5% in June as widely expected. The Federal Open Market Committee (FOMC) still sees around 50 basis points of interest rate cuts through the end of 2025.
Fed Chair Jerome Powell warned that ongoing policy uncertainty will keep the Fed in a rate-hold stance, and any rate cuts will be contingent on further improvement in labor and inflation data.
The People’s Bank of China (PBOC) decided to leave its Loan Prime Rates (LPRs) unchanged on Friday. The one-year and five-year LPRs were at 3.00% and 3.50%, respectively.
S&P Global Australia Manufacturing Purchasing Managers Index remained consistent at a 51.0 reading in June. Meanwhile, the Services PMI edged higher to 51.3 from the previous reading of 50.6, while the Composite PMI improved to 51.2 in June from 50.5 prior.

Australian Dollar tests nine-day EMA near 0.6500

AUD/USD is trading around 0.6480 on Tuesday. The technical analysis of the daily chart shows a revival of the bullish bias, as the pair has rebounded to the ascending channel pattern. Additionally, the 14-day Relative Strength Index (RSI) has moved slightly above the 50 mark, strengthening the bearish bias. However, the pair is still below the nine-day Exponential Moving Average (EMA), indicating that short-term price momentum is weaker.

The AUD/USD pair is primarily testing the nine-day EMA at 0.6480. A successful breach above this level would reinforce the bullish sentiment and lead the pair to approach the seven-month high of 0.6552, which was recorded on June 16, followed by the ascending channel’s upper boundary around 0.6600.

On the downside, the immediate support appears at the lower boundary of the ascending channel around 0.6440, aligned with the 50-day EMA at 0.6435. A break below this crucial support zone would help the bearish bias to grow and put downward pressure on the AUD/USD pair to test the “throwback support” around the psychological level of 0.6400. A break below this level may prompt the pair to navigate the region around 0.5914, the lowest level since March 2020.

AUD/USD: Daily Chart

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 US Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.24%	-0.43%	-0.67%	-0.15%	-0.80%	-0.89%	0.03%
EUR	0.24%		-0.23%	-0.45%	0.08%	-0.57%	-1.08%	0.27%
GBP	0.43%	0.23%		-0.22%	0.32%	-0.33%	-0.85%	0.36%
JPY	0.67%	0.45%	0.22%		0.54%	-0.17%	-0.26%	0.58%
CAD	0.15%	-0.08%	-0.32%	-0.54%		-0.66%	-1.17%	0.04%
AUD	0.80%	0.57%	0.33%	0.17%	0.66%		-0.52%	0.69%
NZD	0.89%	1.08%	0.85%	0.26%	1.17%	0.52%		1.22%
CHF	-0.03%	-0.27%	-0.36%	-0.58%	-0.04%	-0.69%	-1.22%

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).

Economic Indicator

Fed's Chair Powell testifies

Federal Reserve Chair Jerome Powell testifies before Congress, providing a broad overview of the economy and monetary policy. Powell's prepared remarks are published ahead of the appearance on Capitol Hill.

GBP/USD remains slightly bid near 1.3300

GBP/USD now advances marginally and manages to dispute the 1.3300 region on Tuesday. Indeed, Cable regains some balance on the back of the lacklustre performance of the Greenback, all preceding the Fed’s meeting on Wednesday and the BoE’s gathering on Thursday.

EUR/USD recedes from tops, back below 1.1400

EUR/USD manages to set aside part of the recent weakness and clinches decent gains on Tuesday. Indeed, spot keeps the trade below the 1.1400 mark amid acceptable losses in the US Dollar, all following rising optimism of a US-Iran deal and steady caution prior to the FOMC gathering on Wednesday.

Gold bounces on poor US data

Gold remains under marked downside pressure on Tuesday, although the $4,000 zone per troy ounce emerges as a decent support for now. The precious metal’s pullback comes despite the modest losses in the US Dollar in a context of easing geopolitical tensions ahead of the key Fed event on Wednesday.

XRP falls toward $1.00 despite dwindling exchange reserves

Ripple (XRP) continues to trade under increasing pressure on Tuesday. This marks the second consecutive day of declines, reflecting broader risk-off sentiment as investors appear to shift gears in anticipation of the Federal Reserve (Fed) interest rate decision. On Wednesday, the Federal Open Market Committee (FOMC) is widely expected to leave interest rates unchanged in the 3.50%-3.75% range.

Warning signs in the stock market: Is this the top, or just a very short fuse?

Overnight, South Korea's Kospi fell more than 10%, SK Hynix lost close to 15% and Samsung Electronics lost 13%. Into that, Dow Jones Industrial Average futures traded up around 1% on paint and soft drinks, and S&P 500 futures sat roughly flat. An index that absorbs a memory-chip panic and prints nothing is not a calm market.

US Dollar mid-year outlook: Exceptional currency, exceptional risks?

The US Dollar enters the second half of 2026 in a markedly different position from a year ago. The King currency has recovered, reflecting persistent US inflation, changing expectations for Fed policy, geopolitical tensions and renewed demand for defensive assets.