Anna 
The Australian Dollar (AUD) exhibited resilience and extended gains despite fluctuations on Thursday. The AUD/USD pair responded positively to an improved risk appetite, even as the US Federal Reserve (Fed) maintained its commitment to keeping interest rates elevated until inflation sustains the 2% target. Favorable conditions in the Australian money market, along with hawkish remarks from Reserve Bank of Australia (RBA) Governor Michele Bullock earlier in the week, contributed to the strength of the Aussie Dollar.
Following Tuesday’s RBA interest rate decision, Governor Bullock refrained from providing explicit guidance on future policy actions, leaving markets to anticipate potential interest rate cuts later in the year. While Chinese Consumer Price Index (CPI) data slightly missed expectations, showing a monthly growth of 0.3% and an annual decline of 0.8%, the AUD remained supported.
The US Dollar Index (DXY) continued its three-day decline, influenced by a correction in US Treasury yields. However, Federal Reserve Chair Jerome Powell dismissed the possibility of a rate cut in March. Market attention now shifts to the US jobs data, particularly Initial Jobless Claims, set to be released on Thursday.
Federal Reserve Governor Adriana Kugler expressed satisfaction with progress on inflation, expressing optimism about its sustainability. In contrast, Fed Boston President Susan Collins hinted at potential rate cuts later in the year if economic conditions align with expectations. The varying remarks from Fed officials contribute to the overall uncertainty in currency markets.
