AUD/USD consolidates strong daily gains below 0.7700
- AUD/USD rose to fresh multi-week highs near 0.7700.
- US Dollar Index remains depressed below 92.00 on Wednesday.
- Eyes on FOMC Chairman Powell’s speech, Fed’s Beige Book.
After posting modest daily gains on Tuesday, the AUD/USD pair continued to gather bullish momentum and touched its highest level since March 23 at 0.7696. As of writing, the pair was up 0.63% on a daily basis at 0.7686.
USD selloff takes a breather ahead of American session
The heavy selling pressure surrounding the USD amid slumping US Treasury bond yields provided a boost to AUD/USD. After the Core Consumer Price Index in the US arrived at 1.6% on a yearly basis in March, the benchmark 10-year US T-bond yield turned south. Additionally, the strong demand witnessed in the 30-year US Treasury note auction further weighed on yields.
Reflecting the broad-based greenback weakness, the US Dollar Index (DXY) slumped to a fresh multi-week low of 91.66 before going into a consolidation phase.
Ahead of FOMC Chairman Jerome Powell’s speech at 1600 GMT and the Federal Reserve’s Beige Book publication, the DXY is posting small daily losses at 91.75.
On Thursday, the Australian Bureau of Statistics will release the April Consumer Inflation Expectations and the labour market report for March. Investors expect the Unemployment Rate to edge lower to 5.7% with the Employment Change arriving at +35,000. A stronger-than-expected reading could help the AUD continue to outperform its American counterpart and vice versa.