If you've ever asked yourself how an announcement in Washington or New York could end up as a headline in Sydney the next morning, you're not alone. In today's global economy, the U.S. has this large domino effect: when it tips, we all feel it — including Australia.

Following the US economic calendar is one way to get ahead of these ripples. The calendar picks out major events such as Fed meetings, inflation prints, employment reports, and GDP numbers. These might sound like faraway numbers, but they often set the market tone for Australia and other markets, businesses, and households.

So how does the US economic calendar influence what happens down under? Let's look a little closer.

The Importance of the U.S. Economic Calendar to Australians

Investors worldwide look closely at the US economic calendar because the U.S. economy is the biggest economy in the world. Because of this, whenever U.S. data is released — whether it be strong jobs data or higher inflation—global U.S. financial markets react almost immediately.

For Australia, this matters because we are part of the same system. As the U.S. economy changes, so do our exports, currency, stock market, and possibly interest rates. This serves as a reminder that no economy is truly independent in this economy.

The Australian Dollar and the U.S. Dollar

The most obvious connection between the U.S. and Australian markets is through the currency market. The AUD and the USD are constantly at war today.

If the U.S. economy has positive data, the USD will usually become stronger. If the USD becomes stronger, then the AUD will be weaker based on their historical constant value comparison.

The weaker AUD benefits Australian exporters to other countries by making Australian exports cheaper to foreign buyers.

However, for businesses or industries that are reliant on imported products, the weaker AUD means increased import costs (e.g., machinery costs for construction, fuel prices, retail product prices, etc.).

The Flow-On Effect on the Stock Market

Have you ever noticed how the Australian share market reacts to the overnight moves in Wall Street? Well, that's not by chance.

If the U.S. Federal Reserve hints at raising interest rates, technology and growth stocks will be affected worldwide, with the ASX following suit.

Conversely, commodity/resource prices (like iron ore and coal) will rise if U.S. demand looks strong. Many of the big stocks on the ASX are miners, which can only benefit Australian investors.

Put simply: When U.S. investors sneeze, Australian traders often catch a cold- or in good times, the sunshine.

Exports and Global Demand

Australia's economic reliance on exports, especially in mining and agriculture, is immense. Asia is our biggest buyer, but the U.S.'s demand and general economic condition are predominantly influenced by world commodity prices.

A booming U.S. economy = more demand for raw materials = higher prices for exporters in Australia.

A slowing U.S. economy = less demand = lower prices = trade balance can be affected.

It's no wonder Australian businesses keep an eye on important events marked on the US economic calendar; it helps them account for any movement in global demand.

Interest Rates and Capital Flows

Initially, whatever the U.S. Federal Reserve does regarding interest rates doesn't necessarily only affect Americans — it also affects the Reserve Bank of Australia (RBA).

Here's how:

Higher rates in the U.S. may entice global investors to invest in American bonds and/or assets.

This can detract funds from Australian markets, cause downward pressure on the Australian dollar, and introduce pressure onto the RBA to act and try and have the RBA also change rates.

In essence, while the RBA is responsible for conducting policy in Australia, it does not have the luxury of making decisions in isolation. The Fed's actions are always in the background.

What This Means for Australian Businesses

If you are running or investing in an Australian business, here is the operational takeaway:

Keep on the calendar: U.S. announcements such as job reports or Fed meetings can move the AUD or ASX overnight. Being aware of dates to prepare for.

Prepare for Currency Movement: If your business involves imports or exports, hedging strategies can help you remain protected against sudden exchange-rate movements.

Be Aware of Your Industry Exposure: Resource companies will likely benefit from strong U.S. growth, but businesses that import with the Australian dollar will have a harder time when the USD strengthens.

Expect Movement: Even if you are not a global trader, market movements can have a drastic effect on awareness, confidence, spending, and investment in Australia.

Conclusion

The US economic calendar is not just for Wall Street; it is a roadmap to evaluate the global economy for all, including Australians. From the worth of the Aussie dollar, the health of our exports, and our equities market, U.S. data points influence our economy, almost more than people realize.

For Australian businesses, paying attention to these updates is not about being in the know; it is about being prepared. In a world where markets are interconnected as never before, what happens in the U.S. today is often the precursor to the opportunities and challenges Australia will experience tomorrow.