The AUD to USD market bias is currently leaning bullish. The Reserve Bank of Australia is expected to raise interest rates early next year due to rising inflation, which may strengthen the Aussie. Meanwhile, forecasts suggest the US Federal Reserve will reduce rates, which typically weakens the USD.
Key drivers include the anticipated interest rate hikes by the RBA, creating a favorable interest rate differential. Additionally, improving global economic growth and rising commodity prices may support demand for the AUD. Importantly, recent safety concerns in Australia may slightly dampen consumer confidence.
The near-term trading range for AUD to USD is expected to remain within a stable range around current levels. Upside risks could stem from stronger-than-expected commodity prices or improvements in market risk sentiment. Conversely, downside risks may arise from concerns over US economic stability or further geopolitical tensions affecting market confidence.