AUD/USD Surges 0.8% to 0.7240 on Iran Talks

The Australian dollar surged against the U.S. dollar on Wednesday, climbing about 0.8 percent to settle near 0.7240 after touching an intraday high of 0.7280, its strongest level in nearly four years.

The advance pushed the AUD/USD pair close to the 0.7250 level before momentum faded, with traders citing improved risk sentiment from signs of progress in U.S.-Iran talks over the Strait of Hormuz. President Donald Trump paused U.S. "Project Freedom" operations in the strait, pointing to advancements in Pakistan-mediated negotiations. Iranian Foreign Ministry spokesperson Esmail Baghaei confirmed that Tehran was reviewing a recent U.S. proposal, though some Iranian officials described the one-page document as a mere list of American demands rather than a substantive offer. A nominal ceasefire has held since April 8, but sporadic exchanges of fire continue, and the strait remains largely closed to commercial traffic.

The developments eased concerns over prolonged disruptions to global energy supplies, boosting demand for risk-sensitive currencies like the Australian dollar while curbing safe-haven flows into the U.S. dollar. This risk-on tone overshadowed stronger-than-expected U.S....