In September, Australia saw its month-over-month import growth fall to 1.1%, down from 3.2%. This shows that imports are slowing compared to earlier data. Several financial markets are making significant moves. The GBP/USD pair rose as traders anticipated a decision on interest rates from the Bank of England. At the same time, the Australian Dollar gained strength as the US Dollar weakened thanks to better market sentiment.

Forex Movements

The EUR/USD pair traded cautiously below the 1.1500 mark while it awaited data on German industrial production and Eurozone retail sales. The Japanese Yen showed limited gains due to uncertainty around a possible rate hike from the Bank of Japan. In commodities, West Texas Intermediate (WTI) hovered around $59.50, facing downward pressure from oversupply concerns. Gold remained steady around the $4,000 mark, lacking a clear direction. In the cryptocurrency market, Decred, Internet Computer, and Quant made notable gains. However, these altcoins might hit resistance despite their recent upturns. Overall, market sentiment remains uncertain due to various economic factors. The significant drop in Australian imports to 1.1% for September raises a warning about domestic demand. This slowdown indicates that consumers and businesses are scaling back, a trend likely to persist into the final quarter. Such conditions put pressure on the Reserve Bank of Australia (RBA) to consider a more cautious approach in its next meetings.

Economic Indicators

This perspective is backed by recent data showing that retail sales in October fell by 0.2%, reported just last week. The RBA’s own statement from their meeting on Tuesday expressed worries about the strength of consumer spending. This reflects a cooling economy as we head into 2026. Also, we should monitor the commodities market, which significantly affects the Australian dollar. Iron ore prices have dropped below the crucial $100 per tonne level for the first time since a brief decline in 2024, amid concerns about slowing industrial activity in China. This presents an additional risk for the currency. Given this situation, we see opportunities to short the Australian dollar against the US dollar. The difference is clear, especially as the latest US Core PCE data showed inflation steady at 2.8%, pushing the Federal Reserve in a different policy direction. Buying AUD/USD put options may be a wise choice to prepare for a potential drop towards the 0.6500 support level. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now