AUD/USD has been trading in a range between 0.66 at the bottom and 0.68 at the top for several months now, as the uncertainties regarding the global economy and further interest rate hikes by the FED and other central banks remain high. This pair tested the top of the range about two weeks ago and pierced it for a while, but it reversed back down and headed down toward the bottom of the range.
Although, the Aussie received a boost due to dovish comments made by FED Chairman Jerome Powell on Friday. The market has interpreted this as an indication that there may be a pause in monetary tightening by the central bank in June. This dovish sentiment outweighed any hawkish remarks from regional Federal Reserve presidents last week, which continued yesterday.
As a result, AUD/USD experienced a corrective upward movement against the US Dollar (USD) on Friday, but yesterday we saw some slight bearish momentum again. The economic data early today didn’t offer much of a surprise, with manufacturing activity remaining in contraction while services remained in expansion.
Australian Manufacturing and Services PMI for May
AUD/USD
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