AUD/USD clings to strong intraday gains near the 0.6625-30 zone, at two-week highs

• The AUD/USD pair is gaining ground for the second day in a row and hitting 2-week highs.
• Uncertainty about the Fed’s rate hike path weighs on the dollar and supports the pair.
• The mixed US NFP report does not impress USD bulls or provide any momentum for the pair.

The pair AUD/USD It is holding near a 1.5-week high around the 0.6625-0.6630 zone during Friday’s North American session and is little moved in reaction to mixed US monthly jobs data.

The US dollar (USD) got a mild boost after the NFP showed that the US economy added 339,000 new jobs in May, beating consensus estimates by a wide margin. In addition, the previous month’s figure was also revised upwards. That being said, uncertainty about the Fed’s next move is keeping any dollar advance limited and continues to support the strong offered tone surrounding the AUD/USD pair for the second day in a row.

It is worth remembering that markets have been pricing in the possibility of another 25 basis point hike at the next FOMC meeting on June 13-14. However, this week a number of influential Fed officials supported the idea of ​​not raising interest rates. Aside from this, the risk-on momentum – led by optimism over the passage of legislation to raise the government’s $31.4 trillion debt ceiling and avoid a record US default – weakens the USD and benefits the Aussie, risk sensitive.

The Australian dollar (AUD) is also supported by hopes of a recovery in the world’s second largest economy, bolstered by a private survey released on Thursday, which found China’s manufacturing sector unexpectedly posted modest growth in May. This, coupled with speculation that the Reserve Bank of Australia (RBA) could further tighten its monetary policy, favors AUD/USD bulls and suggests the path of least resistance for the pair.

technical levels