AUD / USD consolidates losses below 0.7300, remains near multi-month lows

• AUD / USD fell to its lowest level since November at 0.7279.
• The US Dollar Index is holding on to modest daily gains above 92.70.
• RBA noted that recent coronavirus outbreaks are weighing on the recovery.

After closing the first day of the week in negative territory, the AUD / USD pair fell under heavy downward pressure during the Asian session and fell to its lowest level since November at 0.7279. Currently, the pair is consolidating its losses below 0.7300, shedding 0.6% on the day at 0.7293.

RBA’s Cautious Tone Weighs Over AUD

In the Minutes of its July policy meeting, the Reserve Bank of Australia (RBA) acknowledged that recent outbreaks of the delta variant of the coronavirus disrupted the economic recovery. “The bond purchase programs will continue to be reviewed in light of economic conditions and the health situation,” the RBA noted and AUD weakened against its rivals.

Commenting on the market reaction to the RBA’s statement, “the RBA says it is willing to act if the lockdowns slow the economic recovery,” Société Générale economists said. “AUD / USD has made bearish projections near 0.7300 / 0.7285, however signs of a rebound are not yet visible. A move below 0.7285 will take the pair towards the next projections at 0.7230 and 0.7110.”

On the other hand, risk aversion is helping the safe-haven dollar outperform its risk-sensitive rivals on Tuesday, the US dollar index, which gained 0.1% on Monday, is currently up 0.12% on the day at 92.72.

Later in the session, retail sales and industrial production data for July will appear on the economic calendar.

Technical levels to take into account