AUDUSD falls from a five-week high as the RBA’s Lowe, US data

AUDUSD Bears take a breather around the mid-0.6700s on early Wednesday as traders await RBA Governor Philip Lowe’s speech. After the Aussie central bank paused the rate hike trajectory and pleased sellers the day before.

The RBA has paused its rate hike trajectory and referred to the Aussie bears as RBA Statement defends hawks.

The RBA announced the status quo of its current monetary policy after ten consecutive rate increases, with the benchmark rate at 3.60% at the latest. In doing so, the Australian central bank justifies the recent deterioration in Australian inflation and retail sales data. While also stating that the “Board expects that some further tightening of monetary policy may well be required.”

Softer US data, positive sentiment, and threats to the US Dollar’s reserve currency status drown out the US Dollar.

The risk-on mood is accompanied by news that recent challenges to the US Dollar’s reserve currency status appear to be weighing on the greenback.

Bloomberg published a news report claiming that the United States The dollar is losing favor as a reserve currency in Russia, highlighting the dollar’s recent weakness. “Chinese Yuan surpassed the US Dollar as the most traded currency in Russia in monthly trading volume for the first time in February.” According to the news, which also stated that the gap has widened in March.

Brazil and China agreed last week to suspend the use of the US dollar as an intermediary in trade transactions.

Alternatively, Russian Foreign Minister Sergei Lavrov raised concerns about the escalation of the Moscow-Brussels spat by declaring. That “the European Union (EU) has “lost” Russia.” The policymaker also stated that, if necessary. Moscow will deal with Europe harshly. The US-China tension is also on the rise, as Beijing continues to reiterate its dislike for US-Taiwan relations. But Washington appears to ignore it. The spokesperson for China’s Consulate General in Los Angeles criticized a meeting between Taiwan President Tsai Ing-wen and US House Speaker Kevin McCarthy on Tuesday morning.

In terms of data, US Factory Orders for February were -0.7% MoM, compared to -0.5% expected and a downwardly revised -2.1% prior. Furthermore, the US JOLTS Job Openings fell to their lowest level since May 2021, with a figure of 9.931M for February versus 10.4M expected and 10.563M revised previously.

Among these bets, Wall Street closed in the red, while yields fell in response to weaker US data.

RBA’s Lowe must defend his hawkish statement in order to recall Aussie pair buyers; US data is also important.

Moving on, RBA Governor Lowe’s speech will be closely watched by AUDUSD traders. Who will be looking for clues as to how the RBA will proceed. Policymakers may restart the rate hike cycle. Which could boost the Australian dollar.

On the other hand, the US ISM Services PMI for March and ADP Employment Change for the same month will be crucial for any signs of a US Dollar recovery.

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