AUD/USD is around 0.6480 and the Dollar cuts its initial gains, awaiting the NFP

• The AUD/USD pair is trading flat after falling to a daily low of 0.6461.
• US PCE inflation stands at 3.3% yoy, while initial jobless claims come in below estimates, briefly boosting the dollar.
• Mixed PMI data from China and comments from Atlanta Fed President Raphael Bostic complicate the outlook for the currency pair.

He Australian dollar (AUD) Cut part of your losses against the US dollar (USD) after falling to a daily low of 0.6461 before the London fix, while the dollar pared some of its early gains. Traders took profits awaiting the US economic data. The AUD/USD pair is trading at 0.6474, unchanged on the day.

Australian Dollar Recovers Ground from Daily Lows as Investors Take Profits Ahead of August NFP

Financial markets remain quiet so far, past the mid-session in New York. The US economic agenda caused some volatility early in the session, thanks to the latest inflation report. The Fed’s preferred inflation gauge, Personal Consumption Expenditure (PCE), came in at 3.3% year-on-year, as expected above the 3% in June. As for core PCE, sought after by Fed officials as its focal point is stickier than policymakers projected, it stands at 4.s% yoy, as expected, but above 4.1%. of the previous month.

These data and the latest applications for unemployment benefits for the week ending August 26, which were below estimates of 235,000, at 229,000, favored the rise of the dollar. Initial jobless claims were the first positive news in the labor market of the week, as job offers plummeted while private hiring disappointed analysts.

Meanwhile, the Dollar Index, which measures the value of the dollar against a basket of six currencies, rose 0.41% to 103.606. US Treasury yields fell

Upbeat market sentiment dampened AUD/USD as China revealed manufacturing PMIs improved but remained in contractionary territory. The non-manufacturing PMI deteriorated from 51.5 to 51.0, below estimates of 51.1.

As for the central banks, the president of the Atlanta Fed, Raphael Bostic, declared that monetary policy was adequately restrictive to bring inflation closer to the 2% target set by the US central bank within a “reasonable” period.

For the next week, the Australian economic calendar will include the S&P Global Manufacturing PMI for August. In the US, the economic agenda will be busy, with the release of non-farm payrolls and the ISM manufacturing PMI, both figures for August, standing out.

AUD/USD Price Analysis: Technical Perspective

From a technical point of view, the AUD/USD pair maintains a neutral bias to the downside as it remains below the 50 and 200 day DMAs. However, recent price developments suggest that the current rally could be seen as a correction that pierced the 61.8% Fibonacci retracement at 0.6520. This, coupled with back-to-back spinning tops candles, could pave the way for further losses, with traders eyeing the year-to-date low of 0.6364.