AUD/USD loses recovery momentum, drops to fresh daily low below 0.7330
|- AUD/USD turned south following a rebound in early American session.
- US Dollar Index regained its traction after dropping on US CPI data.
- Wall Street's main indexes turned negative on the day after opening higher.
The AUD/USD pair staged a rebound in the early American session and climbed above 0.7360 fueled by the broad-based USD weakness. However, the pair lost its momentum and quickly retraced its rally. As of writing, AUD/USD was trading at a fresh daily low of 0.7328, losing 0.5% on a daily basis.
USD capitalizes on risk-off flows
Earlier in the session, the data published by the US Bureau of Labor Statistics revealed that inflation, as measured by the Core Consumer Price Index (CPI), declined to 4% in August from 4.3% in July. This print came in lower than the market expectation of 4.2% and triggered a USD selloff.
However, the negative shift witnessed in market sentiment helped the greenback regather its strength and caused AUD/USD to turn south. The US Dollar Index, which fell to 92.32 after CPI data, is currently virtually unchanged on the day at 92.56.
US Inflation Quick Analysis: Team Transitory wins, dollar loses, why the trend may extend.
Reflecting the souring market mood, Wall Street's main indexes are losing between 0.6% and 0.3% on the day.
On Wednesday, the Westpac Consumer Confidence data for September and the HIA New Home Sales figures for August will be featured in the Australian economic docket.
Technical levels to watch for
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