- PBoC’s decision to leave rates unchanged helped regain some traction.
- A pickup in the US bond yields underpinned the USD and capped gains.
The AUD/USD pair held on to its positive tone through the early European session on Monday and is currently placed at over one-month tops, above mid-0.6800s.
Following an initial dip to an intraday low level of 0.6840, the pair managed to regain some positive traction and added to its recent strong gains in reaction to the Peoples Bank of China’s (PBOC) surprise decision to leave the benchmark rate unchanged.
A modest USD uptick capping gains
The coupled with the prevalent risk-on mood further drove flows towards perceived riskier currencies and provided an additional boost to the China-proxy Australian Dollar, albeit a modest US Dollar uptick kept a lid on any strong follow-through.
A goodish rebound in the US Treasury bond yields underpinned the USD and eventually capped gains for the major. However, growing odds of another Fed rate cut in October might continue to weigh on the Greenback and help limit any intraday pullback.
The pair remains at the mercy of the USD price dynamics and any incoming trade-related headlines amid absent relevant market-moving US economic releases on the first day of a new trading week.
Technical levels to watch
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