- AUD / USD is falling sharply ahead of key US events.
- The US dollar index rises above 92.00 despite falling US Treasury yields.
- Risk aversion is providing a boost to the USD.
The pair AUD/USD it closed the first day of the week in positive territory, but came under heavy downward pressure on Tuesday. At time of writing, the pair is trading at its lowest level in two weeks at 0.7667, shedding 1% on the day.
DXY jumps above 92.00
Broad-based USD strength appears to be weighing on AUD / USD. The US Dollar Index (DXY) is currently climbing 0.45% to 92.14 despite a 3.75% decline seen in 10-year US Treasury yields. Market risk aversion, as reflected in falling global stock indices, is helping the dollar outperform rivals as a safe haven.
Later in the session, Federal Reserve Chairman Jerome Powell and Treasury Secretary Janet Yellen will testify before Congress on the government’s response to the pandemic. Additionally, St. Louis Fed Chairman James Bullard, Atlanta Federal Reserve Bank Chairman Raphael Bostic will deliver speeches on the state of the economy.
Meanwhile, investors will closely monitor the performance of the major Wall Street indices. Currently, S&P 500 futures are down 0.4% on the day and a sharp pullback in US equities could allow the dollar to remain strong in the second half of the day.
On Wednesday, Commonwealth Bank of Australia’s manufacturing and services PMI reports will be considered for further momentum.
Technical levels
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