AUDUSD currency pair remained down at an intraday low, snapping a two-day gain run.

AUDUSD is trading at 0.6980 following the testimony of Reserve Bank of Australia (RBA) Governor Philip Lowe during the mid-Asian session on Wednesday. As a result, the Aussie pair looks to be giving greater weight to the Fed’s hawkish signals and the market’s pessimistic tone ahead of significant data/events from the US and Australia.

RBA Governor Lowe before the Senate Economics Legislation Committee looks to be less hawkish.

RBA Governor Lowe said before the Senate Economics Legislation Committee that “inflation is simply too high” and that it has to be reduced. However, the policymaker also emphasized that the government’s fiscal policy is essentially neutral, implying that more steps to reduce inflation are required in addition to rate rises. The same seems to benefit Aussie bears in maintaining the reins around the daily low. Lowe’s remarks were not as striking as Federal Reserve (Fed) policymakers’ support of higher rates, despite the lower US Consumer Price Index (CPI). As a result, after a two-day absence, the AUDUSD pair is back on the bear’s radar.

Fed members defend their rate increase stance.

Despite the fact that inflation in the United States did not meet “positive surprise” expectations, the majority of Federal Reserve (Fed) policymakers were in support of additional rate rises. The same was true for US Treasury bond rates and the US dollar.

US 10-year Treasury bond rates are hovering around 3.75%, up three basis points (bps) from a six-week high, while the two-year counterpart surged to 4.62%, the highest level since early November 2022. The same was true of Wall Street’s Day-end losses. as well as moderately offered S&P 500 Futures, to support the rise in the US Dollar Index (DXY).

Given the risk-off sentiment and higher US Treasury bond rates, as well as the Fed’s hawkish wagers, the AUDUSD bears are expected to remain in control. However, today’s US Retail Sales and Industrial Production figures for January, as well as the NY Empire State Manufacturing Index for February, should be closely monitored for intraday cues. Above all, Thursday’s Australian job report sought clarity.