Dovish Fed and Yen Intervention Lift AUD/USD to Seven-Week High

AUD/USD rose to its highest weekly close in seven weeks last week, finishing at 0.7030 (+0.67%) as the US dollar weakened under pressure from the Federal Reserve's dovish remarks and Japanese yen intervention.

The Fed held interest rates steady at 3.50% - 3.75%, with Chair Kevin Warsh failing to back up his previous comments on inflation-fighting credibility, leaving markets concerned about a potential policy error.

Meanwhile, Tokyo intervened in the foreign exchange market, buying yen worth an estimated ¥6 trillion - ¥9 trillion, and was reportedly joined by coordinated action from the New York Fed on behalf of the US Treasury.

The intervention pushed the yen to its strongest levels since early May and contributed to broad Big Dollar softness that supported the Australian dollar. The pair is now eyeing resistance around 0.7080 - 0.7100, with a sustained break above potentially opening the way for a retest of the May high at 0.7277.