The Australian Dollar continues its descent against its US counterpart for a second consecutive session on Friday. Rising US – Chinese tensions are weighing on demand for the perceived riskier Aussie Dollar whilst simultaneously boosting demand for the safe haven US Dollar.

At 14:00 UTC, AUD/USD is trading -0.66% at US$0.6521. This is at the lower end of the daily traded range. Despite the Aussie Dollar’s losses over the past two session, it is still on track for a weekly gain of around 1.6%.

Risk Off As China Crack Down On Hong Kong

The Australia Dollar is struggling in risk off trading amid a flare up of US – Sino tensions. The two powers have been on a collision course all week. On Wednesday, the US passed legislation restricting Chinese companies from listing on American exchanges. Additionally, President Trump has continued in his efforts to pin the blame of the coronavirus outbreak on China.

Chinese plans to impose a national security law on Hong Kong, limiting freedom in the financial hub has aggravated tensions further. Trump responded quickly warning China against such a move. Markets also fear that China’s manhandling of the law could re-ignite pro-democratic demonstrations which dragged on confidence at the turn of the year.

Not only is the Australia Dollar risk sensitive, it is also considered a proxy for China, its largest trading partner.

Looking ahead investors will remain focus on US – Sino relations. Any improvement could send the Aussie higher. Improving coronavirus statistics could also offer support to the riskier Australian Dollar.

Vaccine News To Help Reset Risk?

The US Dollar is advancing on Friday as investors seek out its safe haven properties. For the same reasons that the Australian Dollar is out of favour, the US Dollar is seeing heightened demand.

News that Oxford University and AstraZeneca are expanding their vaccine trial to 10,000 adults and children following a $1.2 billion backing from US could help risk sentiment heading into the weekend.

There is no high impacting US data today leaving the US Dollar sentiment driven. Looking ahead to next week, the US calendar is relatively quiet until Q1 GDP data on Thursday.  Instead investors will keep a close eye on the cooling US – China relationship and any coronavirus vaccine data. is a news site only and not a currency trading platform. is a site operated by TransferWise Inc. ("We", "Us"), a Delaware Corporation. We do not guarantee that the website will operate in an uninterrupted or error-free manner or is free of viruses or other harmful components. The content on our site is provided for general information only and is not intended as an exhaustive treatment of its subject. We expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of our site, any you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content on our site. Although we make reasonable efforts to update the information on our site, we make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Some of the content posted on this site has been commissioned by Us, but is the work of independent contractors. These contractors are not employees, workers, agents or partners of TransferWise and they do not hold themselves out as one. The information and content posted by these independent contractors have not been verified or approved by Us. The views expressed by these independent contractors on do not represent our views.