Aussie Dollar Remains Subdued

2026-04-07 01:55 By Joshua Ferrer 1 min. read

The Australian dollar remained weak around $0.690, staying near two-month lows as caution built ahead of US President Trump’s deadline regarding the Strait of Hormuz.

Washington set a firm deadline for Iran to reopen the Gulf to shipping or face potential attacks on critical infrastructure if demands are not met.

Heightened risks around the closure of the key oil chokepoint have driven energy prices sharply higher and reinforced demand for the US dollar as a safe haven.

While hopes for a last-minute diplomatic breakthrough have helped cap further decline, sentiment remained fragile, with traders closely watching the 8pm Eastern Time deadline.

Meanwhile, domestic data showed a sharp downturn in activity, with Australia’s S&P Global PMI slipping into contraction in March for the first time in about 18 months.

The services index dropped to 46.3 from 52.8, while the composite eased to 46.6, pointing to weaker private sector activity amid geopolitical tensions and rising fuel costs.



News Stream
Aussie Dollar Remains Subdued
The Australian dollar remained weak around $0.690, staying near two-month lows as caution built ahead of US President Trump’s deadline regarding the Strait of Hormuz. Washington set a firm deadline for Iran to reopen the Gulf to shipping or face potential attacks on critical infrastructure if demands are not met. Heightened risks around the closure of the key oil chokepoint have driven energy prices sharply higher and reinforced demand for the US dollar as a safe haven. While hopes for a last-minute diplomatic breakthrough have helped cap further decline, sentiment remained fragile, with traders closely watching the 8pm Eastern Time deadline. Meanwhile, domestic data showed a sharp downturn in activity, with Australia’s S&P Global PMI slipping into contraction in March for the first time in about 18 months. The services index dropped to 46.3 from 52.8, while the composite eased to 46.6, pointing to weaker private sector activity amid geopolitical tensions and rising fuel costs.
2026-04-07
Aussie Pressured Near 1-Month Low
The Australian dollar rose to around $0.692, but remained near a one-month low as investors weighed fresh developments in the Middle East war. Reports suggest the US, Iran, and regional mediators are discussing terms for a potential 45-day truce that could open the door to a broader de-escalation. This tentative optimism follows President Trump issuing a renewed ultimatum and stepping up threats against Iran’s civilian infrastructure if the Strait of Hormuz is not reopened, a demand Tehran has so far rejected, keeping the vital shipping route effectively constrained. For Australia, expectations for tighter policy continue to build, with markets leaning toward another rate hike at the May meeting as elevated oil prices and a still-tight labor market sustain inflation pressures. Analysts expect the Reserve Bank of Australia to deliver up to three additional hikes in 2026, potentially lifting the cash rate to 4.85%, a level last seen in late 2008.
2026-04-06
Aussie Dollar Heads for Weekly Gain
The Australian Dollar was little changed to around $0.691 on Friday amid thin holiday trading volumes, but on track for a modest weekly rise on hopes of de-escalation in the Middle East war and that the Strait of Hormuz could partially reopen. Reports showed that Iran and Oman are drafting a protocol to monitor tanker traffic through the key oil-shipping route, which has been effectively shut since the start of the war. The plan would place transit under joint supervision and could require ships to pay tolls to Tehran. Meanwhile, President Trump’s latest speech offered little clarity on a swift end to the Iran conflict, though he has previously set a two-to-three-week timeline for ending the war. He also issued fresh threats on Iranian infrastructure in a bid to pressure Tehran in negotiations. In Australia, higher energy costs are already set to lift inflation, forcing downgrades to growth forecasts and raising expectations of further rate hikes as stagflation risks increase.
2026-04-03