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  • AUD/USD trades in the red, having faced rejection at 0.7756 on Wednesday. 
  • Australia’s Treasury Secretary says the economic recovery has been faster-than-expected.

AUD/USD looks to extend Wednesday’s decline despite the Australian Treasury Secretary Kennedy’s positive comments on the economy. 

“Australia’s economy is recovering faster than expected, Kennedy said during his testimony to a Senate committee, adding that it’s a consumption-led recovery. 

Key quotes

Much depends on confidence, particularly on outcomes surrounding the virus.

Looking forward to an increase in business investment this year and next

Public investment is high and expected to continue increasing.

So far, however, Kennedy’s comments have failed to put a bid under the Aussie dollar. The AUD/USD pair is currently trading near 0.7113, representing marginal losses on the day, having declined from 0.7756 to 0.7721 on Thursday. 

Likely keeping the AUD under pressure are signs of unbalanced economic recovery in China, one of Australia’s top export destinations. While China’s Producer Price Index or factory-gate inflation returned to growth in January, the retail inflation, as represented by the Consumer Price Index, contracted. 

Aside from that, the overnight stalling of the risk rally on Wall Street and rising US Treasury yields could be adding to bearish pressures around the AUD. 

Technical levels