Australian Dollar Falls Amid Global Recession Fears

The Australian dollar weakened to around $0.63 on Friday, paring gains from the previous session as risk aversion gripped financial markets amid mounting fears of a tariff-driven global recession.

While US President Donald Trump imposed a 10% tariff on Australian imports, Prime Minister Anthony Albanese ruled out retaliatory measures, noting that the US accounts for less than 5% of Australia’s exports.

However, higher US tariffs on Australia’s key trading partners such as China, Japan, and South Korea dampened the broader outlook for global trade and economic growth.

In response, markets priced in 100 basis points of total rate cuts from the Reserve Bank of Australia this year, up from 75 basis points earlier in the week.

The next rate cut is expected in May, with July and August seen as potential follow-ups.