Australian Dollar remains subdued despite a weaker US Dollar due to growing debt issues
The Australian Dollar (AUD) remains subdued against the US Dollar (USD) for the second successive day on Tuesday. However, the AUD/USD pair maintains its position near a psychological 0.6500 level after pulling back from a six-month high of 0.6537, which was reached on Monday.
However, the continued decline in the US Dollar provides support for the pair, which could be attributed to growing fears over the United States' (US) debt concerns.
China Industrial Profits rose 3% year-over-year in April, following a previous growth of 2.6%. Additionally, the profits increased 1.4% YoY in the first four months of 2025, advancing from 0.8% growth in the January–March period.
Global Times, the Chinese state media outlet, said that positive developments helped drive industrial profits in April.
The State media outlet also cited that new driving force sectors like equipment and high-tech manufacturing saw rapid profit growth, highlighting industrial resilience. Any change in China's economy could impact the AUD due to a close trade relationship with Australia.
The AUD/USD pair could regain its ground as the Greenback faces additional challenges amid improving risk-on sentiment, driven by the easing trade tension between the United States (US) and the European Union (EU).
US President Donald Trump extended the tariff deadline on the European Union (EU) from June 1 to July 9 after having a phone call with European Commission President Ursula von der Leyen on Sunday. On Friday, Trump threatened to impose a 50% tariff on imports from the European Union (EU).
Source: Fxstreet
