Aussie Under Pressure as Oil Prices Soar and Trade Tensions Escalate
The Australian dollar has been struggling this week, on track for its first weekly loss in a month. The currency is being pressured by a stronger US dollar, which is gaining strength due to higher oil prices and renewed trade tensions that are fueling inflation concerns.
Brent crude prices have climbed above $100 per barrel after Houthi attacks on Saudi oil tankers in the Red Sea. Meanwhile, President Donald Trump has threatened further action against Iran, adding to the market's anxiety about rising costs.
The stronger greenback is erasing gains made by the Australian dollar following domestic jobs data that beat forecasts. The soaring oil prices are also strengthening the case for another Reserve Bank of Australia rate hike, which markets now imply with a 40% chance in August and almost full pricing by November.