- AUD / USD came under renewed downward pressure early in the US session.
- The US dollar index is rising shortly after a previous drop.
- The major Wall Street indices erased most of the opening gains.
After climbing to a daily high of 0.7283 early in the European session, the pair AUD/USD it entered a consolidation phase and was afloat in positive territory before trading in the American session. With the dollar starting to gain traction in the second half of the day, AUD / USD turned lower and was last seen shedding 0.25% on the day at 0.7230.
Focus shifts to PBoC
Earlier in the day, the observed positive shift in market sentiment, as reflected by rising European stock indices, made it difficult for the USD to find demand. Although the major Wall Street indices opened decisively higher, they retraced much of the advance and helped the US Dollar Index (DXY) gain traction. Currently, the S&P 500 Index is up just 0.15% to 4.364 and the DXY posts modest gains at 93.26.
The US Census Bureau reported Tuesday that new homes increased 3.9% monthly in August after declining 7% in July. Additionally, building permits increased 6% in the same period. However, these figures do not appear to have a significant impact on risk sentiment.
On Wednesday, the leading Westpac index for August will be included in the Australian economic calendar. Additionally, investors will be on the lookout for monetary policy announcements from the People’s Bank of China (PBoC).