- The Australian Dollar is strengthening as China reportedly considers suspending its 125% levy on select goods arriving from the United States.
- Investor confidence saw a fluctuating pattern after news emerged that the previous US administration might contemplate lowering duties on goods from China.
- The Chinese Finance Ministry pointed out that the global economy is still dealing with challenges, particularly those related to trade and tariff disagreements.
The Australian Dollar (AUD) has risen for the second day in a row against the US Dollar (USD) on Friday, following a Bloomberg news story. Citing knowledgeable sources, the report indicated that China is considering a pause in its 125% tariff on specific imports from the US. These imports include items like medical devices, ethane, and aircraft rentals. The sources also mentioned that officials are specifically debating a potential exemption on duties for leased aircraft. Neither China’s Ministry of Finance nor the General Administration of Customs has released a statement on this matter.
However, the AUD/USD currency pairing encountered resistance due to ongoing trade-related strains between the US and China. Australia’s strong commercial ties with China mean it is especially vulnerable to changes in the relationship between these two major economies.
Investors are still closely monitoring the evolving global trade environment. Market sentiment showed uncertainty after reports circulated that the Trump administration could potentially lower tariffs on Chinese goods, contingent on the advancement of possible discussions with Beijing. China has indicated its readiness to participate in talks, on the condition that the US refrains from making further threats. However, US Treasury Secretary Scott Bessent tempered expectations, stating that no unilateral tariff reductions have been suggested and that official negotiations have not yet begun.
