In the meantime, the latest US Federal Reserve monetary policy minutes, revealed on Wednesday, showed policymakers’ commitment to curb inflation towards its 2% target. In fact, most participants noted that further tightening is required, hurting investors’ speculations the central bank would give signs of pausing or ending its tightening cycle.
During the last two weeks, China’s economic docket paints a troubled economic outlook, as retail sales were weaker than expected, imports and exports plunged, and business activity stalled. That, alongside news that Evergrande’s filing for bankruptcy in New York, added to the ongoing economic turmoil of the second-largest economy worldwide.
- China’s economic indicators signal distress, with weak retail sales, plunging imports/exports, and Evergrande’s bankruptcy filing.
- US Federal Reserve minutes highlight commitment to 2% inflation target but voices caution against overtightening.
- Traders eye upcoming S&P Global PMIs in Australia and a slew of US data, including Powell’s Jackson Hole speech, for directional cues.
The AUD/USD downtrend remains intact, though it failed to achieve a daily close below the November 10 low of 0.6386, keeping buyers hopeful of higher prices. Despite that, AUD/USD could re-test 0.6400, followed by the new year-to-date (YTD) low challenge at 0.6364. A decisive break below the latter, expect the AUD/USD to visit the November 3 swing low of 0.6272, ahead of the 0.6200 figure. Otherwise, the AUD/USD could aim towards the May 31 low of 0.6458 before challenging the 0.6500 mark.
