Home AUD/USD pares large portion of daily gains, trades near 0.7450
FXStreet News

AUD/USD pares large portion of daily gains, trades near 0.7450

  • AUD/USD turns south during the American trading hours.
  • US Dollar Index stages a decisive rebound, climbs above 91.00.
  • Focus shifts to Consumer Inflation Expectations data from Australia.

The AUD/USD pair climbed to its highest level since July 2018 at 0.7485 on Wednesday but struggled to preserve its bullish momentum in the second half of the day. As of writing, the pair was trading at 0.7449, gaining 0.5% on a daily basis.

Earlier in the day, the AUD gather strength after the data published by the Faculty of Economics and Commerce Melbourne Institute showed that the consumer confidence in Australia continued to strengthen in December. Additionally, the upbeat market mood, as reflected by rising global equity indexes, helped the risk-sensitive AUD continue to outperform its rivals. 

DXY rebounds above 91.00 after early drop

In the early trading hours of the American session, however, the US Dollar Index (DXY) staged a decisive recovery and caused AUD/USD to turn south. At the moment, the DXY, which slumped to a daily low of 90.69, is up 0.2% on the day at 91.15.

In the absence of significant macroeconomic data releases, the sharp upsurge witnessed in the DXY could be attributed to investors moving to the sidelines at the end of the European session. European Commission President Ursula von der Leyen and British Prime Minister Boris Johnson will be meeting at 1900 GMT and the outcome of this meeting will be the next significant catalyst on market sentiment. 

On Thursday, the Consumer Inflation Expectations data will be featured in the Australian economic docket. Moreover, the Reserve Bank of Australia will release its Bulletin.

Technical levels to watch for


FX Street

FX Street

FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions.