The Australian dollar rose sharply against the Japanese yen on Monday, touching a multi-week high near 92.00 as investors responded to encouraging signs of easing U.S.-China trade tensions. The move reflects growing risk appetite across financial markets, with trade-sensitive currencies like the Aussie benefiting from hopes of improved global economic cooperation.
AUD/JPY advanced to 91.95, extending a three-day rally as reports emerged that China may consider rolling back some tariffs on U.S. goods. The possibility of a more constructive trade environment between the world’s two largest economies gave markets a boost, with equities, commodities, and risk-linked currencies moving higher.
The Australian dollar, often viewed as a proxy for global growth and Chinese demand, gained ground across the board, while the yen—typically favored during times of uncertainty—lost momentum. The shift in sentiment also reflects reduced demand for safe-haven assets, which has weighed on the Japanese currency despite its historical resilience.
Supporting the rally, firm commodity prices and upbeat risk sentiment have reinforced the bullish trend in AUD/JPY. Iron ore and other key Australian exports saw modest gains on Monday, further underlining the Aussie’s sensitivity to developments in trade and industrial activity.
From a technical perspective, AUD/JPY is now approaching resistance around the 92.20 level, with support seen near 91.40. A sustained move above current levels could indicate further upside potential, particularly if upcoming economic data from China or Australia confirms the improving outlook.
For now, traders are watching for concrete developments on the trade front, while also eyeing central bank commentary from the Reserve Bank of Australia and the Bank of Japan. In the absence of risk-off catalysts, the pair may continue to ride momentum fueled by trade optimism and broad market strength.
