The Australian dollar remained largely unchanged on Jan. 5 as renewed geopolitical tensions triggered a cautious retreat in global risk appetite, although elevated domestic bond yields offered some support.
Early losses saw the AUD dip, before stabilising at $0.6686, just shy of last week’s 14-month high of $0.6727.
Analysts noted that the commodity-linked currency often moves as a proxy for global risk sentiment, reacting even to distant events such as US military action in Venezuela.
Meanwhile, the New Zealand dollar slipped 0.1% to $0.5760, below its recent peak of $0.5853, with chart support seen around $0.5736–$0.5740.
The Australian currency's resilience was underpinned by expectations of higher interest rates at home, pushing 10-year government bond yields to 4.81%, a premium of 67 basis points over US Treasuries.