Australian Dollar edges lower as Trump administration considers tariff on Chinese imports
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The Australian Dollar faces pressure after President Trump announced that his administration is considering a 10% tariff on Chinese imports. Chinese Vice Premier Ding Xuexiang warned about the consequences of a trade war. Trump issued a memorandum directing federal agencies to investigate and address the ongoing trade deficits. The Australian Dollar (AUD) remains subdued against the US Dollar (USD) on Wednesday. The AUD/USD pair faces challenges as US President Donald Trump announced that his administration is considering imposing a 10% tariff on Chinese imports starting February 1. The move is reportedly linked to concerns over fentanyl shipments from China to Mexico and Canada, according to Reuters. Trump mentioned earlier, “If we make a TikTok deal and China doesn’t approve it, we could maybe put tariffs on China.” This comment follows his signing of an executive order delaying the enforcement of the TikTok ban by 75 days. Given the close trading relationship between China and Australia, any developments affecting China’s economy could significantly influence Australian markets. Chinese Vice Premier Ding Xuexiang issued a warning on Tuesday about the repercussions of a trade war, emphasizing that “there are no winners” in such conflicts as China faces the possibility of tariffs under Donald Trump’s newly elected government, according to CNBC. The S&P/ASX 200 Index climbed to around 8,450 on Wednesday, marking its highest level in nearly seven weeks. The rally was supported by a positive lead from Wall Street, driven by US President Donald Trump’s decision to delay implementing tariff threats, which provided relief to global markets. Australian Dollar could gain ground as Trump opts not to impose new tariffs The US Dollar Index (DXY), which tracks the performance of the US Dollar against six major currencies, holds ground around 108.00 at the time of writing. However, the Greenback faced headwinds as President…
Filed under: News - @ January 22, 2025 2:26 am