AUD/USD sold-off into renewed risk-aversion wave, tests 0.6750
- Aussie downed by broad USD rebound, CNY depreciation comments amid risk-off.
- Falling Chinese iron-ore futures add to the downside in the AUD.
- All eyes on trade war, US CPI and Australian employment data.
The selling interest around the AUD/USD pair gathered pace in the European trading after the US dollar regained ground across the board amid a major turnaround in the risk sentiment.
Souring risk appetite spurred by trade jitters, Hong Kong protests
Escalating US-China trade row combined with the latest developments surrounding the Hong Kong protests triggered risk-aversion across the board, with the US equity futures turning south in tandem with the Treasury yields.
Hong Kong cancels all flights and Chinese police assembling in Shenzhen
Moreover, the sentiment around the Australian dollar was dented by the slump in the Chinese iron-ore prices. The ferrous metal hit fresh two-month lows of CNY 609.50 ($86.31) per tonne amid worries of weak demand and supply risks. Note that iron-ore is Australia’s top export product.
Further, a weaker Yuan fix by the PBOC, in a bid to counter the impact of the US tariffs on the economy, also added to the bearish momentum seen in the spot while markets digest the weekend’s comments on US-China trade by the US President Trump.
The higher-yielding currency will continue to get influenced by the risk trends in the session ahead, as the US docket remains data-empty this Monday. Also, in focus remains the speech by the Reserve Bank of Australia (RBA) policymaker Kent for near-term trading impetus ahead of the US CPI and Australian jobs data.
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.
