AUD/USD struggles to extend the recovery, focus shifts to RBA
- AUD/USD recovers after upbeat Chinese Caixin Manufacturing PMI.
- Further upside lacks momentum amid mixed Aussie data, trade woes.
- Aussie awaits RBA for fresh impetus, US markets are out on Labor Day.
With the new US-Sino tariffs kicking-in, the AUD buyers seem to lack vigor so far this Monday, leaving AUD/USD in a tight range between 0.6720-0.6735 levels.
RBA to stand pat on Tuesday – Scotiabank
The spot managed to pull off the lows reached in early Asia after the CBA Manufacturing PMI for August arrived at 50.9 points, down from 51.6 points in July. However, the renewed upside fizzled out following mixed Australian ANZ Jobs Advertisement data and Company Operating Profits numbers.
However, the bulls once again regained poise and hit session highs at 0.6735 following an unexpected expansion seen in the Chinese manufacturing sector in August, as reflected by the Caixin Manufacturing PMI data that came in at 50.4. The recovery was shallow, as markets continued to weigh the lingering US-China trade war fears after both the US and China imposed fresh tariffs on each other’s’ goods on Sunday.
The commodity-currency also failed to get any boost from the commodities, as gold traded on the back foot amid a broadly stronger US dollar while oil prices were little changed amid the latest tariffs.
Meanwhile, the bulls remained cautious ahead of the Australian Retail Sales and Trade report due on Tuesday ahead of the key Reserve Bank of Australia (RBA) monetary policy decision. The RBA is widely expected to keep the policy steady, as they want to wait and watch the impact of the previous rate cuts.
In the meantime, the pair will remain at the mercy of the USD dynamics and risk trends amid holiday-thinned quiet trading.
AUD/USD Technical levels to consider
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.
