AUD Stuck in Neutral as Iron Ore Prices Plummet

The Australian Dollar (AUD) has remained relatively stable against the US Dollar (USD) on Tuesday morning, trading at 0.7018. This comes as iron ore prices have dropped to their lowest level in 11 months, with futures hitting $92.85. The decrease is attributed to weaker Chinese demand and narrowing margins at steel mills.

The AUD/USD pair's stability can also be linked to the performance of the energy market, where oil prices are significantly lower than last month. Oil pulled back after the US halted planned attacks against Iran over the weekend. However, the risk remains that attacks could resume as there has been no ceasefire signed between the two sides.

The Reserve Bank of Australia (RBA) meeting next week is expected to be a key event for traders. Economists are divided on whether the bank will raise interest rates due to stubbornly high inflation.