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Australian Dollar retreats from over two-week high, up a little around 0.6950 vs USD

  • AUD/USD gains some follow-through traction amid a weaker USD, though bulls seem hesitant.
  • Iran risks and prospects of at least one Fed rate hike in 2026 limit USD losses, capping the pair.
  • The RBA’s hawkish tilt might continue to support the Aussie, warranting some caution for bears.

The AUD/USD pair attracts buyers for the second straight day and climbs to a two-and-a-half-week top, around the 0.6970 area, during the Asian session on Friday. Spot prices, however, retreat a few pips in the last hour and currently trade around mid-0.6900s, still up 0.10% for the day.

Against the backdrop of Wednesday's less hawkish FOMC Minutes, hopes for diplomacy to ease tensions in the Middle East drag the safe-haven US Dollar (USD) to an over one-week low and act as a tailwind for the AUD/USD pair. US President Donald Trump told reporters on Thursday that Iran had called to make a deal with the US. Furthermore, a White House official signaled that the US is still committed to the memorandum of understanding with Iran as technical talks over Tehran's nuclear program and the Strait of Hormuz continue.

However, the geopolitical risk premium remains in play amid renewed fighting between the US and Iran. In fact, the US military unleashed a new wave of strikes against Iran earlier this week in retaliation for Tehran’s attacks on commercial ships in the Strait of Hormuz. Iran responded by targeting American allies across the region and bombing US military installations in Bahrain and Kuwait. Apart from this, prospects for at least one interest rate hike by the US Federal Reserve (Fed) in 2026 help limit USD losses and cap the AUD/USD pair.

Any meaningful corrective pullback, however, seems elusive in the wake of hawkish rhetoric from the Reserve Bank of Australia (RBA). In fact, RBA Assistant Governor Sarah Hunter warned earlier this week that if elevated global energy prices persist due to the Iran conflict, further monetary tightening could be warranted to return inflation to target. In the absence of any relevant economic releases, the fundamental backdrop backs the case for an extension of the AUD/USD pair's recent recovery from a three-month low, touched in June.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Canadian Dollar.

USDEURGBPJPYCADAUDNZDCHF
USD-0.07%-0.11%-0.47%-0.04%-0.10%-0.23%-0.22%
EUR0.07%-0.04%-0.39%0.04%-0.03%-0.17%-0.16%
GBP0.11%0.04%-0.35%0.08%0.00%-0.11%-0.12%
JPY0.47%0.39%0.35%0.43%0.36%0.21%0.21%
CAD0.04%-0.04%-0.08%-0.43%-0.07%-0.21%-0.21%
AUD0.10%0.03%-0.01%-0.36%0.07%-0.14%-0.16%
NZD0.23%0.17%0.11%-0.21%0.21%0.14%-0.01%
CHF0.22%0.16%0.12%-0.21%0.21%0.16%0.00%

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 US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

Author

Haresh Menghani

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

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Australian Dollar holds mid-0.6900s as weak USD meets Iran risks