- AUD/USD lost its traction after staying around 0.7200.
- US Dollar Index clings to daily gains above 93.00.
- US Existing Home Sales, Manufacturing and Services PMI coming up next.
The AUD/USD posted small daily gains on Thursday and stayed relatively quiet around 0.7200 during the Asian trading hours on Friday. With the greenback gathering strength ahead of the American session, the pair lost its traction and dropped to a daily low of 0.7171. As of writing, AUD/USD was down 0.18% on the day at 0.7176.
USD stays strong ahead of mid-tier US data
The data from Australia showed that Retail Sales in July expanded by 3.3%. However, the Commonwealth Bank Services PMI slumped from 58.2 in July to 48.1 in August’s preliminary reading and made it difficult for the AUD to find demand.
Meanwhile, the US Dollar Index is posting modest gains above 93.00 despite falling US Treasury bond yields on Friday. In the second half of the day, Existing Home Sales and the IHS Markit’s Manufacturing and Services PMI data will be featured in the US economic docket.
Investors expect the preliminary Manufacturing PMI to improve to 51.9 in August from 50.9 in July and show an ongoing expansion in the sector’s economic activity at a stronger pace. A better-than-expected reading could trigger a rebound in the US T-bond yields and help the greenback finish the week on a strong footing while keeping the bearish pressure on AUD/USD intact.
Technical levels to watch for
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