AUD/USD turns upside down as US Dollar bounces back – Crypto News – Crypto News
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AUD/USD faces pressure around 0.6400 ahead of flash US PMI AUD/USD faces pressure around 0.6400 ahead of flash US PMI

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AUD/USD turns upside down as US Dollar bounces back – Crypto News

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10 months ago

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  • AUD/USD surrenders intraday gains as the US Dollar recovers after US Hassett ruled it fears of a recession.
  • Investors expect that the US lacks the competency to arrange substitutes for Chinese goods domestically.
  • US Hassett expresses positive development in trade talks between Washington and the EU.

The AUD/USD pair gives up its intraday gains and turns negative during North American trading hours on Monday. The Aussie pair drops to near 0.6280 from the intraday high of 0.6340 as the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, rebounds after visiting near the three-year low of 99.00.

The USD Index attracts bids after Director of the United States (US) National Economic Council (NEC) Kevin Hassett ruled out the possibility of a recession. “100% not expecting a recession,” Hassett said in an interview with Fox Business Network. Hassett added that we are making “enormous progress” on tariff talks with the European Union (EU).

Earlier in the day, the US Dollar (USD) was facing severe pressure amid fears of potential recession due to the escalating trade war between the US and China. The US and China have increased import duties on each other significantly. Investors worry that this could lead to a slowdown in the US economy as its environment is insufficient to offset the need for goods imported from China. Such a scenario is inflationary for the economy and could diminish the purchasing power of households significantly.

Additionally, positive development on trade deal between the US and Eurozone is also favorable for the US Dollar. This indicates that the trade war would be limited between the US and China for now.

This week, investors will focus on the US Retail Sales data for March, which will be released on Wednesday. The Retail Sales data, a key measure of consumer spending, is estimated to have grown strongly by 1.4% against the 0.2% increase seen in February.

On the Aussie front, the intensifying trade war between the US and China remains a key concern for the Australian economic outlook, given its significant dependence on its exports to China. Domestically, investors will focus on the employment data for March, which will be released on Thursday. The employment report is expected to show that the Unemployment Rate accelerated to 4.2% from 4.1% in February.

 

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