AUD/USD: Risk-off caps the bounce to 0.6930, focus on US data
- Bounces on USD retreat amid falling US yields, but gains capped by risk-off.
- Next of relevance remains the US macro data as trade-related news to dominate.
The AUD/USD pair popped its range trade around 0.6915 region and hit fresh daily tops near 0.6930, tracking the retreat in the US dollar across the board amid a collapse in the US 10-year Treasury yields to fresh 20-month lows below 2.160%.
The mounting fears of a global recession, following the start of a new trade war between the US and Mexico, killed the appetite for the risk assets across the financial markets this Friday. As a result, the global yields slumped, led by the declines in the US Treasury yields across the curve.
Despite the latest uptick, the AUD bulls lack vigor on widespread risk aversion and uncertainty over the US-China trade spat. Further, the commodity-currency also remains displeased by the falling oil and copper prices.
Meanwhile, the aggressive calls for an RBA rate cut next month combined with dismal Chinese and Australian fundamentals continue to remain a weight on the Aussie. The official Chinese manufacturing and services PMI reports released earlier today disappointed markets and accentuated the China slowdown fears.
Attention now turns towards the US Core PCE Price index and Consumer Sentiment data for fresh dollar trades while the risk trends will continue to remain the main market driver.
AUD/USD Technical Levels
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
