AUD/USD edges higher toward 0.7300 ahead of US PMI data
- AUD/USD staged a rebound after declining to 0.7250.
- US Dollar Index stays calm below 94.00 ahead of PMI data.
- RBA left its policy settings unchanged as expected in October.
The AUD/USD pair turned south during the Asian trading hours on Tuesday and fell to a daily low of 0.7250 before regaining its traction. As of writing, the pair was virtually unchanged on a daily basis at 0.7284.
DXY clings to modest daily gains, eyes on PMI data
As expected, the Reserve Bank of Australia (RBA) announced that it left its policy rate unchanged at 0.1% while deciding to continue to purchase government securities at a rate of A$4 billion a week until at least mid-February. Investors largely ignored the RBA's policy statement and the risk-averse market environment made it difficult for the AUD to find demand during the first half of the day.
Other data from Australia revealed that the trade surplus widened modestly in August on the back of a 4% increase in exports.
Meanwhile, with the US stock index futures rising between 0.5% and 0.4% ahead of Wall Street's opening bell, the greenback is struggling to gather strength and allowing AUD/USD to stage a recovery. The US Dollar Index (DXY), which touched a daily high of 94.04, is currently up 0.15% at 93.94.
Later in the session, the IHS Markit and the ISM will both publish the September Services PMI reports for the US. On Wednesday, TD Securities Inflation 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.
