Australia's economy expands more than expected.

The Australian dollar remained steady over the past week as investors continued to monitor U.S. President Donald Trump's tax plan. Recently, Trump reaffirmed his stance on imposing tariffs on global trading partners, which will take effect on April 2. Additionally, Australia remains under pressure after the U.S. imposed a 25% tariff on steel and aluminum imports, affecting Australian exports worth over AUD 1 billion. Despite trade concerns, the slight expansion of the domestic economy has helped ease some worries.

Although the U.S. has quickly imposed the 25% import tariffs on steel and aluminum, Australian Prime Minister Anthony Albanese has decided not to retaliate with counter-tariffs. Instead, he continues to seek negotiations to secure an exemption from Trump's steel and aluminum tariffs. Prime Minister Albanese commented, "Retaliatory measures could increase consumer costs and drive inflation higher, so negotiations are likely the best approach." However, President Trump remains firm that there will be no exceptions or exemptions for these tariffs, which will apply to all U.S. trading partners.

Australia’s consumer confidence index rose by 4% in March, reaching 95.9, the highest level in three years. This increase was driven by the Reserve Bank of Australia's interest rate cut in February and declining cost-of-living pressures, improving consumer sentiment. This optimism has directly impacted the labor market, while key concerns such as inflation and interest rates remain major factors in shaping consumer expectations about the economic outlook. Although global trade tensions continue to escalate, overall, Australian consumers maintain a positive outlook.

Australia's economy grew by 0.6% quarter-on-quarter in Q4 2024. On an annual basis, GDP expanded by 1.3%, surpassing market expectations of 1.2% growth. This expansion was largely supported by a recovery in household spending, particularly on essential expenses such as rent and healthcare. Private sector investment also showed signs of improvement, mainly in infrastructure development. Additionally, increased exports contributed to further economic expansion.

Australia’s trade surplus rose to AUD 5.62 billion in January, up from AUD 4.92 billion in the previous month, due to strong export growth and a slight decline in imports. Exports increased by 1.3% to AUD 44.53 billion, primarily driven by a surge in gold exports, which soared by 78.6% to AUD 5.36 billion. Other export sectors showed only slight increases. Survey data indicated that exports to the U.S. surged by 104.3%, while exports to China, Australia’s largest trading partner, declined by 21.5%.

The yield on Australia's 10-year government bonds surged to 4.48% as investors assessed the monetary policy outlook of the Reserve Bank of Australia (RBA). Strong recent economic data has dampened expectations for an RBA interest rate cut, given the higher-than-expected GDP growth. Furthermore, the latest RBA meeting signaled a more cautious approach toward future interest rate adjustments.

Techical analysis data (5H)

Resistance: 1.5841, 1.5849, 1.5856

Source: Investing.com

Buy/Long 1: If the price touches support in the price range of 1.5819 - 1.5826 but cannot break the support at 1.5826, you may set a TP at approximately 1.5849 and SL at around 1.581 or according to your acceptable risk.

Buy/Long 2: If the price breaks the resistance in the price range of 1.5841 - 1.5849, you may set a TP at approximately 1.5856 and SL at around 1.5819 or according to your acceptable risk.

Sell/Short 1: If the price touches resistance in the price range of 1.5841 - 1.5849 but cannot break the resistance at 1.5841, you may set a TP at approximately 1.5819 and SL at around 1.5856 or according to your acceptable risk.

Sell/Short 2: If the price breaks the support in the price range of 1.5819 - 1.5826, you may set a TP at approximately 1.581 and SL at around 1.5849 or according to your acceptable risk.

Pivot point March 14, 2025 09:36 PM. GMT+7