Weekly FX Update
08 June 2026
The AUD gets caught between oil, the Fed, and risk sentiment
The Australian dollar starts the week under pressure after a stronger-than-expected US jobs report pushed the US dollar to around a two-month high. Reuters reported that US non-farm payrolls increased by 172,000 in May, well above expectations, and that markets lifted the probability of a Fed rate hike later this year to above 70%. The AUD slipped to around a two-month low near 0.7016 in early Monday trade.
At the same time, renewed Middle East tensions pushed oil prices higher, with WTI and Brent trading above US$93 and US$95 respectively. That creates an uncomfortable mix for FX markets: higher oil can support commodity-linked currencies in normal times, but right now it is feeding inflation worries and supporting the USD through higher US rate expectations.
In simple terms: the AUD is sitting in the middle of a tug-of-war. Commodities are pulling one way, the stronger US dollar is pulling the other, and inflation is standing in the middle looking very pleased with itself.
What’s Driving Markets This Week
- US labour market remains resilient – supporting the USD and reducing expectations of aggressive rate cuts.
- Oil prices remain elevated – continuing to influence inflation expectations globally.
- AUD holding steady – supported by commodity exports but facing headwinds from a stronger USD.
What’s Happening
The Australian dollar remains relatively stable despite ongoing global uncertainty. Commodity prices continue to provide support, although a resilient US economy is keeping the US dollar well bid.
Markets are increasingly focused on upcoming inflation and consumer spending data to determine whether central banks can begin easing policy later this year.
Overall, sentiment is constructive, but investors remain cautious about inflation and geopolitical risks.
Key Exchange Rates (approx.)
| Pair | Indicative Level | ||||||||||||||||||
| AUD/USD | ~0.70 | ||||||||||||||||||
| AUD/EUR | ~0.61 | ||||||||||||||||||
| AUD/GBP | ~0.52 | ||||||||||||||||||
| AUD/JPY | ~111 | ||||||||||||||||||
| AUD/CNH | ~4.85 | ||||||||||||||||||
| AUD/NZD | ~1.19 |
Commodities Snapshot
| Commodity | Indicative Level | ||||||||||||
| WTI Oil | ~US$100–105/bbl | ||||||||||||
| Brent Oil | ~US$105–110/bbl | ||||||||||||
| Gold | ~US$4,450–4,500/oz | ||||||||||||
| Silver | ~US$75/oz | ||||||||||||
| Iron Ore | ~US$105–110/t |
Key Economic Events This Week (Sydney Time)
| Day | Date | Time | Event | Why It Matters |
| Wednesday | 11 Jun | 10:30 PM | US CPI Inflation | Key inflation measure |
| Thursday | 12 Jun | 10:30 PM | US Initial Jobless Claims | Labour market strength |
| Thursday | 12 Jun | 10:30 PM | US PPI Inflation | Producer price pressures |
| Friday | 13 Jun | 10:30 PM | US Consumer Sentiment | Confidence and spending outlook |
AUD Outlook
The AUD continues to trade within a relatively stable range but remains sensitive to:
- US inflation data
- Commodity prices
- Global risk sentiment
- China growth expectations
Expected AUD/USD range this week:
0.69 – 0.71
Quick Take
AUD-positive scenario: Australian GDP holds up, commodity prices remain firm, and US labour data softens enough to reduce USD support.
AUD-negative scenario: China data continues to weaken, Australian GDP disappoints, and US payrolls or wages come in stronger than expected.
This week’s reminder: FX markets are like office printers — they usually behave until you really need them to. Then they pick the busiest week to become dramatic.
👉 AUD stable but struggling to break higher
👉 USD remains supported by strong US data
👉 Inflation data is the key market event this week