AUDUSD falls below 0.6710 on Fed rate raise bets. The pair’s decline has been extended below 0.6710 as the USD Index has recovered.

AUDUSD pressured greatly on mixed initial S&P PMI readings

In the early London session, the AUDUSD pair’s negative movement reached close to 0.6714. As the US Dollar Index (DXY) has shown an uptrend trade after forming a foundation of around 101.80. It is anticipated that the Australian asset will go even farther south.

The USD Index has increased to close to 101.86 and is predicted to go even further. While being wary, traders are putting money into the USD Index. After three negative trading periods to avoid volatility triggered by the quarter-end result season. S&P500 futures are flat in early Europe. The US Treasury rates are still battling for revival the in the meantime. The rate of return on 10-year US Treasury bonds is currently 3.52% or such.

The US Federal Reserve is unwilling to moderate its aggressive posture on interest rates. Despite knowing that manufacturing activity in the United States has been declining for the past few months. And job markets have declined further amid increasing weekly out-of-work claims.

According to Reuters, Cleveland Federal Reserve President Loretta Mester underlined on Thursday that the Fed has to do more to address the US inflation. Additionally, he said, “Fed will have increase its the interest rate above 5% and stay there for some time.”

Following confusing initial S&P PMI data, the Australian dollar has been under severe stress.

Due to the conflicting preliminary S&P PMI (April) figures, the Australian Dollar is under a lot of stress. Manufacturing PMI dropped significantly from its previous reading of 49.1 and to the average of 48.8 to 48.1. Whereas the Services PMI increased from the previous publication of 50.7 to 52.6.

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