As we look ahead to 2025, many are wondering how President Trump’s fiscal policies will affect the AUD/USD exchange rate. Trump’s economic agenda has been characterized by tax cuts, deregulation, and protectionist trade policies. These measures have had a significant impact on the US economy and global markets.
One key factor to consider is the potential impact of Trump’s policies on inflation and interest rates. If Trump’s policies lead to higher inflation, the Federal Reserve may need to raise interest rates to combat rising prices. This could lead to a stronger US dollar, which would likely put downward pressure on the AUD/USD exchange rate.
Additionally, Trump’s protectionist trade policies have the potential to disrupt global trade flows and impact the Australian economy, which relies heavily on exports. If Trump’s policies lead to trade tensions with key trading partners, such as China, this could weigh on the Australian dollar and push the AUD/USD exchange rate lower.
Overall, Trump’s fiscal policies are likely to have a significant impact on the AUD/USD exchange rate in 2025. It will be important to monitor developments in US economic policy and global trade relations to assess the potential effects on the currency pair.