Australian Dollar Monthly

The Australian dollar was one of the weakest members of the G10 currency basket in October, ahead of only the New Zealand dollar and Japanese yen. The Aussie’s fall came despite pricing for the first RBA cash rate cut being pushed back to the second quarter of next year.

After a weak start to the month, the Australian dollar was the best performer of the G10 trading currencies during September. The Aussie fell early in September amid faltering risk appetite, as soft US employment data raised concerns that the US economy could be slowing more sharply than expected.

The Australian dollar climbed against all of the big four currencies and almost all of the currencies in the G10 trading basket, except for the New Zealand dollar and Swedish krona.

The Aussie dollar had its first monthly fall against the greenback since April, losing 1.9% in July. The decline came despite the US dollar also showing some weakness during the month. The US dollar index, which values the big dollar against a basket of major currencies, declined by 1.7% in July.

The AUD/USD exchange rate had its least volatile month since December 2002 in June, before closing the month 0.3% higher, its third monthly increase in the past four months and its highest monthly close since December last year.

The Australian dollar had its strongest monthly rise against the greenback since December, climbing 2.8% in May. The exchange rate began the month trading below US$0.65 but received a lift early as the greenback sank after a tepid US employment report boosted market expectations for Fed rate cuts this year.