• RBA rate cut speculations/disappointing domestic data weigh on the Aussie.
• A further escalation in the US-China trade tensions does little to lend support.
• A subdued USD demand helped limit losses ahead of FOMC meeting minutes.
The AUD/USD pair struggled below the 0.6900 handle through the Asian session on Wednesday and remained well within the striking distance of multi-month lows.
With investors looking past a surprise election victory for the incumbent Aussie PM Scott Morrison, the Australian Dollar came under some intense selling pressure on Tuesday after the latest RBA policy meeting minutes revealed that the central bank is willing to cut benchmark interest rates.
Apart from growing bets over an eventual RBA rate cut, the domestic currency was further weighed down by Wednesday's disappointing release of Australian construction data - showing a contraction of 1.9% in the first three months of 2019 as against expectations for a no change.
The already weaker sentiment deteriorated further on reports that the Trump administration could blacklist Chinese surveillance technology firm - Hikvision and is also considering cutting off the flow of vital American technology to as many as five Chinese companies.
The news added to the recent escalation in the US-China trade tensions and weighed on investors' risk sentiment, doing little to lend any support to the China-proxy Australian Dollar or provide any immediate respite to the perceived riskier currency.
Meanwhile, a subdued US Dollar price action, consolidating the recent strong gains to multi-week tops, seemed to be the only factor helping limit further downside ahead of today's key risk - the release of minutes from the latest FOMC monetary policy meeting, due later during the US session.
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds steady near 1.0650 amid risk reset
EUR/USD is holding onto its recovery mode near 1.0650 in European trading on Friday. A recovery in risk sentiment is helping the pair, as the safe-haven US Dollar pares gains. Earlier today, reports of an Israeli strike inside Iran spooked markets.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD is rebounding toward 1.2450 in early Europe on Friday, having tested 1.2400 after the UK Retail Sales volumes stagnated again in March, The pair recovers in tandem with risk sentiment, as traders take account of the likely Israel's missile strikes on Iran.
Gold: Middle East war fears spark fresh XAU/USD rally, will it sustain?
Gold price is trading close to $2,400 early Friday, reversing from a fresh five-day high reached at $2,418 earlier in the Asian session. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row.
Bitcoin Price Outlook: All eyes on BTC as CNN calls halving the ‘World Cup for Bitcoin’
Bitcoin price remains the focus of traders and investors ahead of the halving, which is an important event expected to kick off the next bull market. Amid conflicting forecasts from analysts, an international media site has lauded the halving and what it means for the industry.
Geopolitics once again take centre stage, as UK Retail Sales wither
Nearly a week to the day when Iran sent drones and missiles into Israel, Israel has retaliated and sent a missile into Iran. The initial reports caused a large uptick in the oil price.