- Construction sector in Australia continues to lose momentum.
- US Dollar Index moves sideways below the 99 handle.
- Coming up: National Australia Bank’s (NAB) business confidence data.
The AUD/USD pair staged a rebound in the second half of the previous week and erased the losses it suffered following the Reserve Bank of Australia’s decision to cut the policy rate by 25 basis point. After closing the week virtually unchanged at 0.6770, the pair edged lower on Monday and fell to a fresh daily low of 0.6732 before returning to the 0.6740/50 area. As of writing, the pair was down 0.35% on the day at 0.6744.
AUD fails to build on recent gains
Earlier in the day, the Australian Industry Group’s (AIG) Performance of Construction Index dropped to 42.6 in September from 44.6 in August to weigh on the AUD.
Meanwhile, reports suggesting that China is unlikely to offer commitments on reforming Chinese industrial policy or the government subsidies to the United States (US) at this week’s high-level talks in Washington made it difficult for antipodeans to find demand.
On the other hand, the US Dollar Index is consolidating last week’s losses on Monday in the absence of any significant macroeconomic data releases. At the moment, the index is flat on the day at 98.84. Federal Open Market Committee (FOMC) Chairman Jerome Powell is scheduled to deliver a speech later in the session but experts don’t expect him to touch on the US economic performance or the monetary policy outlook.
During the early Asian trading hours on Tuesday, the National Australia Bank’s (NAB) Business Confidence and Business Conditions data will be looked upon for fresh impetus.
Technical levels to watch for
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