AUD/USD slips back towards 0.7350 as RBA’s Lowe speaks, focus on US inflation
- AUD/USD drops over 15 pips to refresh intraday low.
- RBA’s Lowe rejects rate hike concerns but stays hopeful on delayed economic recovery.
- Vaccine optimism, easy covid infections keep buyers hopeful but tapering concerns challenge the bulls.
- Market sentiment improves amid mixed catalysts ahead of the key US inflation figures.
AUD/USD takes offers around 0.7360, down 0.08% intraday, after RBA Governor fails to convince buyers with this cautious optimism during early Tuesday.
The Reserve Bank of Australia (RBA) Chief Philip Lowe cited virus concerns in his speech on “Delta, the Economy and Monetary Policy” at an online event hosted by Anika Foundation. However, the policymaker sounds optimistic about the future economic growth while saying, “Delta outbreak has delayed, not derailed economic recovery.”
While RBA’s Lowe pulled the AUD/USD prices back to the red, following the positive week-start, market sentiment remains positive ahead of the key US inflation data, keeping buyers hopeful. However, pre-CPI anxiety keeps the traders on the edge amid mixed catalysts.
On the positive side, China’s recently good communication skills, when linked to the Western leaders, join hopes of faster vaccinations and easy virus numbers, recently to 1,605 versus yesterday’s 1,751 for Australia.
Alternatively, hurricanes and typhoons are challenging commodity prices and risk appetite while the Fed tapering chatters are also on the spike and favor the AUD/USD bears, due to its risk barometer status.
That said, the US 10-year Treasury yields stay firmer around 1.336% while S&P 500 Futures print mild intraday gains by the press time.
Moving on, AUD/USD traders will need to keep their on the US Consumer Price Index (CPI) for August for fresh impulse. Should the price pressure inflates, the pair sellers will have another reason to tighten the grips.
Technical analysis
AUD/USD remains chopped between 20-day and 50-day EMA levels, respectively around 0.7385 and 0.7350, while steady RSI conditions signal a lack of momentum. However, the pair’s sustained trading below 100-day EMA, around 0.7460 by the press time, as well as the last week’s downside break of an ascending trend line from August 20, keeps the AUD/USD sellers hopeful.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
