The Australian Dollar is experiencing a downturn amid positive Australian Retail Sales data. Intense risk aversion is gripping the market, largely influenced by US President Donald Trump's recent imposition of tariffs on Canada, Mexico, and China. These tariffs have sparked fears of a global trade war, subsequently boosting the haven demand for the US Dollar, which is currently in high demand across all markets.
In Monday's Asian trading session, the USD/JPY pair extended its gains, climbing above 155.50. Meanwhile, the AUD/USD is facing significant pressure, plummeting toward 0.6100. This movement comes as traders show little interest in the Bank of Japan's Summary of Opinions, focusing instead on the broader implications of the trade tensions initiated by the US.
Gold, traditionally seen as a safe-haven asset during times of economic uncertainty, is pulling back from its record highs. Early Monday, it traded modestly in the red, slipping below $2,800. The resurgence in US Dollar demand and President Trump's tariffs announcements have collectively diminished Gold's appeal as a refuge for investors seeking stability.
The current economic climate underscores a widespread preference for the US Dollar amid escalating trade war concerns. The tariffs have amplified risk aversion sentiments, causing ripples across global markets and influencing currency pair movements.