AUD/USD eases from daily tops, holds above 0.7800 ahead of US data
- AUD/USD is trading in a relatively tight range on Wednesday.
- Data from Australia showed that the GDP expanded by 3.1% in Q4.
- Focus shifts to private sector employment and Services PMI data from US.
The AUD/USD pair spent the Asian session trading in a narrow band and came under modest bearish pressure ahead of the American session on Wednesday. As of writing, the pair was down 0.09% on a daily basis at 0.7810.
Earlier in the day, the data published by the Australian Bureau of Statistics revealed that the Gross Domestic Product (GDP) in the fourth quarter expanded by 3.1% on a quarterly basis. Although this reading came in better than the market expectation of 2.5%, it failed to provide a boost to the AUD.
USD gathers strength on the back of rising T-bond yields
On the other hand, the US Dollar Index (DXY), which lost 0.3% on Tuesday, started to edge higher on the back of rising US Treasury bond yields during the European trading hours and forced AUD/USD to lose its traction. At the moment, the DXY is up 0.18% on the day at 90.95 and the 10-year US T-bond yield is rising 3.7%.
Later in the day, the ADP Employment Change data from the US will be watched closely by market participants. Additionally, the IHS Markit and the ISM will be both releasing the February Services PMI reports. Finally, the Federal Reserve will release its Beige Book in the late American session.
On Thursday, January Trade Balance and Retail Sales figures 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.
