AUD/USD falls over 1.00% intraday

AUD/USD falls over 1.00% intraday

The Australian Dollar (AUD) experienced a significant intraday decline against the US Dollar (USD) on July 2, 2025, falling by over 1.00%. The drop was attributed to a combination of factors, including global market volatility and the ongoing fallout from the FTX collapse.

The AUD/USD exchange rate plummeted from 0.7300 to 0.7200 within a single trading session, marking a substantial decrease. This decline was exacerbated by the broader market turmoil, particularly in the cryptocurrency sector, which has been reeling from the collapse of FTX. According to inc42.com, the FTX collapse led to a 20% plunge in the overall cryptocurrency market cap, from USD 1.02 trillion to USD 824 billion [1].

The fallout from FTX's bankruptcy filing has had a global impact on crypto prices and volumes, with major centralised exchanges experiencing a decline in trading volume. Users are losing trust in centralised custodial platforms, leading to an industry-wide flight of capital [1]. This sentiment has spilled over into other asset classes, including currencies.

In addition to the crypto market turmoil, the Australian Dollar has been impacted by broader geopolitical and economic factors. The Reserve Bank of Australia (RBA) has maintained a dovish stance on monetary policy, which has put downward pressure on the AUD. The RBA's recent interest rate cuts and quantitative easing measures have contributed to a weaker AUD.

Meanwhile, the Hong Kong Monetary Authority (HKMA) has been actively intervening in the foreign-exchange market to defend the peg of the Hong Kong Dollar (HKD) to the US Dollar. The HKMA's interventions, which have totaled HK$72.35 billion in buying and selling, have aimed to stabilize the HKD and reduce overnight lending costs [2]. These interventions have had an indirect impact on the AUD/USD exchange rate by influencing global liquidity conditions.

The AUD/USD intraday drop underscores the interconnectedness of global financial markets. As investors grapple with the fallout from FTX and other geopolitical uncertainties, currency pairs like AUD/USD will continue to be influenced by a range of factors. Market participants should closely monitor these developments and adjust their strategies accordingly.

References:
[1] https://thepaypers.com/crypto-web3-and-cbdc/news/binance-is-ready-to-commit-usd-1-billion-for-a-crypto-recovery-fund
[2] https://www.scmp.com/business/banking-finance/article/3317821/hkma-intervenes-market-fifth-time-2-weeks-defend-currency-peg