AUD/USD keeps losses despite big beat on Aussie Q2 construction sector data
NEWS |
- A better-than-expected Q2 construction sector data has failed to put a bid under the AUD.
- Losses in the S&P 500 futures are likely playing a spoilsport this Wednesday morning in Asia.
- Dismal China growth forecasts by Moody’s could hurt the Aussie dollar.
The AUD/USD pair is threatening to snap the four-day winning streak.
At press time, the currency pair is trading at 0.7354 – down 0.25 percent on the day, having rallied 120 pips in the last four trading days.
The weak tone in the Aussie dollar seen today could be associated with signs of risk aversion in the US equity index futures.
Former Trump lawyer Michael Cohen testified yesterday that Trump directed him to commit a crime ahead of the 2016 Presidential election. As a result, the S&P 500 futures dropped 0.45 percent and weighed over the AUD and other risk currencies.
Aussie construction work done in the second quarter – a key component of GDP – came in at 1.6 percent, beating the forecast of 0.7 percent by a big margin, but so far, has not had a positive impact on the AUD/USD, possibly due to fears that Chinese economy is slowing down.
Ratings agency Moody’s expects China’s economy to grow at 6.6 percent this year following a 6.9 percent growth in 2017.
Looking forward, the pair may extend losses if the CNY slides. Further, markets may buy USD as the Fed minutes, due later today, are likely to reinforce expectations of September rate hike.
AUD/USD Technical Levels
Resistance: 0.7368 (session high), 0.7391 (50-day MA), 0.7453 (Aug. 9 high)
Support: 0.7348 (Aug. 3 low), 0.7326 (5-day MA), 0.73 (psychological level)