AUD / USD makes small daily losses, remains above 0.7500

• AUD / USD is struggling to find direction on Tuesday.
• RBA reiterated that it is ready to add more stimulus if needed.
• The US dollar index remains in negative territory amid risk flows.

The pair AUD/USD it rose at the beginning of the week but erased its gains to close virtually unchanged at 0.7537 on Monday. With market action turning moderate on Tuesday, the pair appears to be struggling to make a decisive move in either direction on Tuesday and was last seen losing 0.2% on the day at 0.7520.

RBA reaffirms a moderate outlook

During Asian business hours, the minutes of the December meeting of the Reserve Bank of Australia (RBA) showed that the bank remains committed to adding more stimulus if necessary. The RBA reiterated that it will focus on the bond purchase program and review the size and duration in future meetings. These comments made it difficult for the AUD to attract investors.

On the other hand, risk flows continue to dominate financial markets on Tuesday and help AUD / USD limit its losses by forcing the dollar to remain under bearish pressure. At time of writing, the US Dollar Index (DXY) was down 0.06% on the day to 90.65. Meanwhile, S&P 500 futures are up more than 0.5% on the day, suggesting that the DXY is unlikely to post a convincing rally in the second half of the day.

Later in the session, IBD / TIPP US industrial production data, capacity utilization and economic optimism will be analyzed for fresh momentum. However, AUD / USD is likely to ignore these readings unless they have a significant impact on the performance of the major Wall Street indices.

Technical levels