AUD/USD drops below 0.7550 amid firmer US dollar, Delta variant worries
|- AUD/USD remains pressured amid DXY strength, Australian lockdown woes.
- Delta variant fears keep investors on the edge, weighing on risk appetite.
- Markets await US CB Consumer Confidence data and covid updates.
The buying interest around the US dollar remains unabated, knocking off AUD/USD to fresh session lows near the midpoint of the 0.7500 level.
As of writing, the aussie loses 0.17% on the day, trading at 0.7553, having faded an uptick to 0.7565 seen during the late-Asian session.
Delta strain unnerves higher-yielding aussie
The safe-haven demand for the US dollar remains intact, as investors remain unnerved over the rapid spread of the Delta covid variant and its risks to the global economic recovery. The greenback also draws support from the hawkish Fedspeak, as most US central bank officials dismiss inflation concerns and remain optimistic about the US economic turnaround.
Meanwhile, the aussie also feels the pull of gravity, as half of Australia’s population is placed back under lockdown, Delta strain spreads.
On Tuesday, Brisbane became Australia’s fourth regional capital city to restrict movement outside of homes except for essential reasons such as shopping and exercise for at least three days, less than 24 hours after a similar move in Perth. and Darwin, over the weekend, announced longer lockdowns of up to two weeks.
Australia has been unable to contain the rapid spread of the new variant while slow vaccine rollout also poses a risk to the nation’s nascent economic recovery, calling for the Reserve Bank of Australia (RBA) to maintain its accommodative monetary policy.
Looking ahead, the pair will take cues from the broader market sentiment and USD price action while awaiting fresh covid updates. The US Consumer Confidence and housing data could also provide fresh trading impulse.
AUD/USD additional levels to watch
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