AUDUSD dropped further as a result of RBA less hawkish remarks

AUDUSD is projected to fall further below 0.6570 as the RBA’s Lowe considers a halt in the policy-tightening cycle.

The AUDUSD pair is exhibiting volatility shrinkage following a perpendicular negative move triggered by Federal Reserve (Fed) head Jerome Powell’s extraordinarily aggressive statements. Despite a one-time drop in Australian inflation, the Aussie asset is trading back and forth below 0.6600 and is projected to weaken further amid less-hawkish rhetoric from Reserve Bank of Australia (RBA) Governor Philip Lowe.

The risk-aversion theme has been sparked by rising worries of a recession in the United States.

While the risk profile continues to deteriorate, S&P500 futures have ceded their minimal losses from the early Asian session. The risk-aversion theme has been sparked by rising worries of a recession in the United States. The US Dollar Index (DXY) has resumed its upward trend, reaching a new three-month high over 105.70. The alpha created by 10-year US Treasury bonds has surpassed the 4.0% level. The statements of RBA Governor Philip Lowe are having an effect on the Australian Dollar. RBA’s Lowe said “The central bank is closer to ending its aggressive cycle of rate hikes as the policy is now in the restrictive region and there are signs the economy was reacting.” The decline in January’s monthly Consumer Price Index (CPI) appears to have boosted the RBA’s Lowe’s confidence.

Lowe of the RBA feels that the reopening of the Chinese economy will be beneficial to the Australian economy.

Apart from that, RBA Governor Lowe feels that the Chinese economy’s openness will be beneficial to the Australian economy. It is worth remembering that Australia is China’s largest trading partner, and a bleak Chinese economic outlook will strengthen the Australian Dollar.

The US Dollar will be directed in the future by the United States Automated Data Processing. (ADP) Employment Change statistics for February.

The US Nonfarm Payrolls (NFP) report will give further clarification later this week. In addition, the publication of the Unemployment Rate and Average Hourly Earnings figures will be critical.