AUD/USD drops below 0.7700 as USD gathers strength on upbeat data
- AUD/USD came under renewed bearish pressure in early American session.
- Private sector employment in US increased by 978,000 in May.
- US Dollar Index posts strong daily gains above 90.20.
After staying under modest bearish pressure during the first half of the day, the AUD/USD pair extended its slide in the early American session and touched a fresh five-day low of 0.7693. As of writing, the pair was trading at 0.7695, losing 0.75% on a daily basis.
USD capitalizes on strong US data
The upbeat macroeconomic data releases from the US provided a boost to the greenback on Thursday weighed heavily on AUD/USD.
The monthly data published by the Automatic Data Processing (ADP) Research Institute showed that the private sector employment in the US increased by 978,000 in May, compared to analysts' estimate of 654,000. Additionally, the US Department of Labor that weekly Initial Jobless Claims declined to 385,000, the lowest reading in more than a year. Finally, Unit Labor Costs rose by 1.7%, surpassing the market expectation for a decrease of 0.4%.
Supported by these readings, the US Dollar Index continued to push higher and was last seen gaining 0.41% on the day at 90.27. Later in the session, the ISM Services PMI will be looked upon for fresh impetus.
Meanwhile, S&P Futures and Nasdaq Futures are down 0.6% and 0.9%, respectively, suggesting that risk-off flows could allow USD to continue to outperform its rivals in the second half of the day.
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.
