AUD/USD loses traction, turns negative on the day near 0.7230
- AUD/USD came under renewed bearish pressure in early American session.
- US Dollar Index is edging higher following earlier decline.
- Wall Street's main indexes erased majority of opening gains.
After rising to a daily high of 0.7283 in the early European session, the AUD/USD pair went into a consolidation phase and stayed afloat in the positive territory ahead of the North American trading. With the greenback starting to gather strength in the second half of the day, AUD/USD edged lower and was last seen losing 0.25% on the day at 0.7230.
Focus shifts to PBoC
Earlier in the day, the positive shift witnessed in market sentiment, as reflected by rising European equity indexes, made it difficult for the USD to find demand. Although Wall Street's main indexes opened decisively higher, they retraced a large portion of the advance and helped the US Dollar Index (DXY) gain traction. Currently, the S&P 500 Index is up only 0.15% at 4,364 and the DXY is posting modest gains at 93.26.
The US Census Bureau reported on Tuesday that Housing Starts rose by 3.9% on a monthly basis in August after declining by 7% in July. Furthermore, Building Permits increased by 6% in the same period. Nevertheless, these figures don't seem to be impacting risk sentiment in a meaningful way.
On Wednesday, the Westpac Leading Index for August will be featured in the Australian economic docket. Additionally, investors will keep a close eye on the People's Bank of China's (PBoC) monetary policy announcements.
PBoC September Preview: Will policymakers step in to ease Evergrande fears?
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.
