AUD/USD hovered near 0.6965 on Monday and was down 0.24% after surrendering earlier gains, as geopolitical tensions and expectations of further Federal Reserve tightening underpinned the US Dollar. The Greenback started the week softer as US Treasury yields retreated from multi-year highs, while hopes of a Russia–Ukraine energy agreement helped temper worries over fuel shortages and inflation. It later rebounded as markets reassessed the policy outlook alongside fresh geopolitical risks.
The Fed’s hawkish bias remains supportive, even as pricing for a late-October move has eased, with a 25-basis-point increase in December still possible. Risk sentiment was further dented after Yemen’s Iran-backed Houthi movement targeted Riyadh’s King Khalid International Airport with missiles and drones, and after Donald Trump raised the prospect of renewed US strikes on Iran. Attention now turns to US PPI on Wednesday and CPI on Thursday, plus Fed Chair Kevin Warsh speaking at the IMF and World Bank meetings in Bangkok on Friday. Technically, AUD/USD sat at 0.6966, below the 100-hour SMA at 0.6970 and just above the 200-hour SMA near 0.6960, with RSI at 39; resistance is seen at 0.6970 then 0.6995 and 0.7005, while support lies at 0.6932, 0.6904 and 0.6883.
Geopolitical Tensions and Fed Policy Drive Currency Movements
AUD/USD hovered near 0.6965 on Monday and was down 0.24% after surrendering earlier gains, as geopolitical tensions and expectations of further Federal Reserve tightening underpinned the US Dollar. The Greenback started the week softer as US Treasury yields retreated from multi-year highs, while hopes of a Russia–Ukraine energy agreement helped temper worries over fuel shortages and inflation. It later rebounded as markets reassessed the policy outlook alongside fresh geopolitical risks.
Technical Levels and Upcoming Economic Events
The Fed’s hawkish bias remains supportive, even as pricing for a late-October move has eased, with a 25-basis-point increase in December still possible. Risk sentiment was further dented after Yemen’s Iran-backed Houthi movement targeted Riyadh’s King Khalid International Airport with missiles and drones, and after Donald Trump raised the prospect of renewed US strikes on Iran. Attention now turns to US PPI on Wednesday and CPI on Thursday, plus Fed Chair Kevin Warsh speaking at the IMF and World Bank meetings in Bangkok on Friday. Technically, AUD/USD sat at 0.6966, below the 100-hour SMA at 0.6970 and just above the 200-hour SMA near 0.6960, with RSI at 39; resistance is seen at 0.6970 then 0.6995 and 0.7005, while support lies at 0.6932, 0.6904 and 0.6883.
