AUD/USD looks firmer above 0.7300 on upbeat Australia Trade Balance

• AUD/USD has surpassed seven-week-old resistance at 0.7313 on upbeat Aussie Trade Balance.
• The risk-off impulse has returned on lack of ceasefire indication post the Russia-Ukraine peace talks 2.0.
• Powell’s testimony confirms a higher inflationary environment going forward.

The AUD/USD pair has witnessed a juggernaut rally in the first week of March. The major has overstepped its seven-week-old resistance at 0.7313 and is comfortably sustaining above the same. The pair has extended its gains on Thursday amid a strong performance by the Australian Trade Balance indicator.

The Australian Bureau of Statistics has reported the Trade Balance at 12,891M, higher than the prior figure of 8824M and market estimates of 9050M. This has underpinned the aussie against the greenback.

Meanwhile, the US dollar index (DXY) has been underperforming on expansion in bets over a 25 basis points interest rate hike by the Federal Reserve (Fed) chair Jerome Powell. Powell’s testimony is ‘loud and clear’ on a fresh wave in inflation amid the Ukraine crisis. But, for the greater good, a quarter of the percent interest rate hike would be more appropriate. However, the DXY is performing strongly on a broader note amid the risk-off impulse on uncertainty in the Russia-Ukraine war and is expected to stay upbeat.

The second round of peace talks between Moscow and Kyiv have turned positive for human life as the Ukrainian civilians are allowed to move to ceasefire zones but the Ukrainian military and Russian rebels will continue to exchange strikes further. However, the volatility in the near term cannot be ruled out and the Russia-Ukraine war is going to escalate further as the majority of the principal sanctions have been imposed on the Kremlin and Moscow has nothing to lose anymore.