AUD/USD remains heavily offered below 0.6500, lowest since November amid stronger USD – Crypto News – Crypto News
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AUD/USD struggles above 0.7000 as traders await Aussie Wage Price Index, FOMC Minutes AUD/USD struggles above 0.7000 as traders await Aussie Wage Price Index, FOMC Minutes

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AUD/USD remains heavily offered below 0.6500, lowest since November amid stronger USD – Crypto News

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  • AUD/USD comes under intense selling pressure and dives to its lowest level since November.
  • Disappointing Chinese PMI prints overshadow stronger Australian consumer inflation figures.
  • A combination of factors lifts the USD to over a two-month high and exerts pressure on the pair.

The AUD/USD The pair attracted fresh sellers following an early uptick to the 0.6535-0.6540 region on Wednesday and continued to lose ground through the first half of the European session. This marks the second consecutive day of downfall and drags spot prices to the lowest level since November 10, around the 0.6475 area in the last hour.

The Australian Dollar (AUD) did get a minor lift following the release of stronger domestic consumer inflation figures, which could force the Reserve Bank of Australia (RBA) to tighten its monetary policies further. In fact, RBA Governor Philip Lowe had warned earlier today that sticky prices could invite more rate hikes by the central bank. The AUD/USD pair, however, struggles to capitalize on the intraday uptick after the disappointing Chinese macro data sparked fears about a global economic slowdown.

The National Bureau of Statistics (NBS) reported this Wednesday that China’s factory activity shrank faster than expected in May. Furthermore, business activity in China’s service expanded at the slowest pace in four months. Apart from this, concerns about the worsening US-China ties overshadow the optimism over raising the US debt ceiling. This, in turn, tempers investors’ appetite for perceived riskier assets, which, along with resurgent US Dollar (USD) demand, weighing on the risk-sensitive Aussie.

In fact, the USD Index (DXY), which tracks the Greenback against a basket of currencies, jumps to a fresh high since mid-March and remains well supported by expectations that the Federal Reserve (Fed) will keep interest rates higher for longer. In fact, the current market pricing indicates a greater chance of another 25 bps lift-off at the next FOMC policy meeting in June and the bets were reaffirmed by the stronger US Core PCE Price Index released on Friday, which showed that inflation remains sticky.

Apart from this, the risk-off impulse lends additional support to the safe-haven Greenback. Meanwhile, the global flight to safety leads to a further decline in the US Treasury bond yields, which might hold back the USD bulls from placing aggressive bets and help limit losses for the AUD/USD pair, at least for now. Nevertheless, the aforementioned fundamental backdrop suggests that the path of least resistance for spot prices is to the downside and any attempted recovery is likely to get sold into.

Furthermore, sustained break and acceptance below the 0.6500 psychological mark validates the negative outlook. Market participants now look to the US economic docket, featuring the release of the Chicago PMI and JOLTS Job Openings data later during the early North American session. Traders will also take cues from speeches by influential FOMC members. This, along with the US bond yields and the broader risk sentiment, will drive the USD and provide some impetus to the AUD/USD pair.

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