AUDUSD falls below 0.6800 as US default worries materialize

AUDUSD struggles to sustain its first daily loss in seven days amid lethargic markets, easing from a late intraday high.

The AUDUSD seesaws around its intraday high, making rounds to 0.6770-60 lately, as it bears the brunt of the market’s cautious sentiment. As well as recently lower second-tier Aussie data, during early Wednesday.

The light schedule ahead of the April US CPI keeps Australian traders on their toes.

Risk appetite remains down as failed debt ceiling discussions in the White House combine with growing concerns about the US banking sector. The market’s anticipation of US inflation data, namely the Consumer Price Index (CPI) for April, might be along the same lines.

The absence of progress in important debt-ceiling discussions at the White House was reported by US Senate Majority Leader Chuck Schumer. Following that, US Vice President Joe Biden hailed the discussion “productive”. And said that House Speaker Kevin McCarthy stated at the meeting that the US will not default on its debt, according to Reuters.

According to the report, US House Speaker McCarthy agreed for their staffs. To meet this week and for the principals to meet again on Friday to continue discussing.

Following the White House’s dismay, global rating agency Moody’s recently stated. “What once seemed unimaginable now seems a real threat.”

It’s worth mentioning that the International Monetary Fund’s (IMF) Chief Economist Pierre-Olivier Gourinchas noted banking anxieties on Tuesday. After the Federal Reserve’s quarterly survey of bank loan officers. Which was issued on Monday, which cited the detrimental impact of increased rates on lending conditions.

In terms of data, Australia’s Roy Morgan Business Confidence fell to 90.2 in April, down from 93.6 the previous month. On the other side, mood indicators in the United States have risen. The prior day’s Australian Retail Sales and China trade figures disappointed AUDUSD bulls.

Market mood falls as US leaders fail to solve the debt ceiling problem on the first try.

Among these bets, the US Dollar Index (DXY) falls to 101.55, halting a two-day winning run, while US 10-year Treasury note rates stay stuck near 3.51% after gaining for four days in a row.

Despite the recent setback, the AUDUSD price may grind higher ahead of the important US CPI report due to expectations of weaker US inflation and US officials’ capacity to address the debt-ceiling expiry.

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