AUD/USD climbs to fresh 11-week highs above 0.6650
- AUD/USD capitalizes on risk-on flows during American session.
- US Dollar Index slumps toward 99.00 after US data.
- Major equity indexes in the US post strong daily gains on Tuesday.
After closing the first day of the week virtually unchanged at 0.6545, the AUD/USD pair stayed relatively quiet during the Asian session.
However, with the selling pressure surrounding the USD intensifying during the second half of the day and the risk-on environment helping the AUD find demand, the pair rose sharply and touched its highest level since early March. As of writing, the pair was up 1.75% on a daily basis at 0.6657.
USD selloff intensifies on Tuesday
The data published from the US on Tuesday supported the view that the worst of the crisis may have already passed. The Conference Board's (CB) Consumer Confidence Index and the Dallas Fed's Manufacturing Index both rebounded modestly in May and New Home Sales rose unexpectedly in April. Reflecting the market optimism, Wall Street's main indexes opened the day decisively higher and were last seen gaining between 0.5% and 2.5%.
The upbeat market mood caused the greenback to face a fresh selling-wave during the American trading hours and provided an additional boost to the pair. At the moment, the US Dollar Index is down 0.78% on a daily basis at 99.02.
There won't be any macroeconomic data releases in the remainder of the day and the risk perception is likely to continue to impact the pair's movements. During the Asian session, Construction Work Done data will be featured in the Australian economic docket.
Technical levels to watch for
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
