AUD/USD slumps to fresh 18-day lows near 0.7050
- AUD/USD is down more than 1% on Thursday.
- Dovish RBA commentary continues to weigh on AUD.
- US Dollar Index pushes higher toward 94.00 in American session.
The AUD/USD pair fell sharply during the Asian trading hours on Thursday and extended its daily decline to a fresh 18-day low of 0.7056 during the American session. As of writing, the pair was down 1.37% on a daily basis at 0.7064.
Investors start pricing an RBA rate cut
Earlier in the day, Reserve Bank of Australia's Governor Phillip Lowe noted that the bank was considering to lower the policy rate to 0.1% from 0.25%. Following this development, Bloomberg reported that there was a 75% chance of an RBA rate cut in November and caused the AUD to lose strength against its rivals.
Meanwhile, the data from Australia showed that the Unemployment Rate in September rose to 6.9% from 6.8% in August with the Employment Change arriving at -29.5K for that period.
On the other hand, the uncertainty surrounding Brexit and waning hopes of a US coronavirus relief bill before the election continue to weigh on market sentiment and help the greenback gather strength as a safe-haven.
The US Dollar Index, which closed in the negative territory on Wednesday, staged an impressive rebound in the second half of the day and was last seen gaining 0.53% at 93.90.
The US Department of Labor announced on Thursday that the weekly Initial Jobless Claims rose to 898K for in the week ending October 10th. Moreover, the NY Empire State Manufacturing Index in October dropped to 10.5 and missed the market expectation of 15.
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.
