- AUD/USD is losing more than 2% on Friday.
- US Dollar Index continues to push higher as T-bond yields recover from daily lows.
- Core PCE Price Index in US stayed unchanged at 1.5% in January.
After recovering toward 0.7800 in the early American session, the AUD/USD pair lost its traction and dropped to its lowest level in more than two weeks at 0.7711. As of writing, the pair was down 2.01% on a daily basis at 0.7715.
DXY extends rally toward 91.00
The unabated USD strength continues to weigh on AUD/USD ahead of the weekend. Although the US Dollar Index (DXY) erased a portion of its daily gains earlier in the day with the US Treasury bond yields staging a deep correction, it reversed its direction and jumped to its highest level in a week at 90.82.
A rebound witnessed in T-bond yields seems to be providing a boost to the USD. Currently, the yield on the benchmark 10-year reference, which lost as much as 4% earlier in the day, is down 1.8% and the DXY is up 0.75% at 90.80.
The data published by the US Bureau of Economic Analysis showed on Friday that the Core Personal Consumption Expenditures (PCE) Price Index, the Fed's preferred gauge of inflation, remained unchanged at 1.5% on a yearly basis in January. Nevertheless, this reading failed to trigger a meaningful market reaction.
Other data showed that Personal Income and Personal Spending increased by 10% and 2.4%, respectively. Finally, the University of Michigan's Consumer Sentiment Index arrived at 76.8 in February's final reading, compared to analysts' estimate of 76.5.
Technical levels to watch for
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD hovers around 1.0700 ahead of German IFO survey
EUR/USD is consolidating recovery gains at around 1.0700 in the European morning on Wednesday. The pair stays afloat amid strong Eurozone business activity data against cooling US manufacturing and services sectors. Germany's IFO survey is next in focus.
GBP/USD steadies near 1.2450, awaits mid-tier US data
GBP/USD is keeping its range at around 1.2450 in European trading on Wednesday. A broadly muted US Dollar combined with a risk-on market mood lend support to the pair, as traders await the mid-tier US Durable Goods data for further trading directives.
Gold: Defending $2,318 support is critical for XAU/USD
Gold price is nursing losses while holding above $2,300 early Wednesday, stalling its two-day decline, as traders look forward to the mid-tier US economic data for fresh cues on the US Federal Reserve interest rates outlook.
Crypto community reacts as BRICS considers launching stablecoin for international trade settlement
BRICS is intensifying efforts to reduce its reliance on the US dollar after plans for its stablecoin effort surfaced online on Tuesday.
Three fundamentals for the week: US GDP, BoJ and the Fed's favorite inflation gauge stand out Premium
While it is hard to predict when geopolitical news erupts, the level of tension is lower – allowing for key data to have its say. This week's US figures are set to shape the Federal Reserve's decision next week – and the Bank of Japan may struggle to halt the Yen's deterioration.