- AUD/USD surges toward 0.6350 as the Australian Dollar outperforms its peers.
- China's latest monetary stimulus boosts demand for the Aussie Dollar.
- Investors focus on the Federal Reserve’s policy decision and Australia’s February employment data.
The AUD/USD pair climbs near 0.6350 during North American trading on Monday, marking its highest level in over a week. The Australian Dollar (AUD) gains strength as China's latest monetary stimulus plan boosts investor confidence. Given Australia’s strong trade ties with China, an improved Chinese economic outlook further enhances the AUD’s appeal.
Over the weekend, China's Ministry of Commerce announced a "special action plan" aimed at stimulating consumption and economic growth. According to Reuters, the plan focuses on raising household incomes, easing financial burdens, and enhancing the overall consumption environment. Additionally, stronger-than-expected Retail Sales and Industrial Production data from China for February have further supported the Aussie Dollar.
On the domestic front, traders are eyeing Australia’s February labor market data, set for release on Thursday. This report will play a key role in shaping expectations for the Reserve Bank of Australia’s (RBA) monetary policy outlook.
Meanwhile, the US Dollar (USD) remains under pressure as investors anticipate an economic slowdown under President Donald Trump’s administration, with policies expected to curb growth while driving inflation higher.
This week, all eyes are on the Federal Reserve’s (Fed) monetary policy decision, scheduled for Wednesday. The central bank is widely expected to maintain interest rates at 4.25%-4.50%.
