The AUD/USD pair is a major currency pair that tracks the exchange rate between the Australian dollar (AUD) and the United States dollar (USD). The pair is widely traded in the foreign exchange market and is affected by a variety of economic and political factors.
On Wednesday, the AUD/USD pair faced renewed selling pressure, reversing a major part of the gains made on the previous day. The pair maintained its offered tone throughout the early North American session and was positioned near the lower end of its daily range, around the 0.6670-0.6660 region.
Factors Contributing to the AUD/USD Pair’s Performance
Several factors may have contributed to the AUD/USD pair’s recent performance. Firstly, the rising number of COVID-19 cases in Australia and the subsequent lockdown measures have negatively impacted the Australian economy. This has led to a decrease in demand for the Australian dollar, resulting in a decline in its value against the US dollar.
Secondly, the recent surge in US Treasury yields has also put pressure on the AUD/USD pair. Higher yields on US Treasury bonds attract foreign investors, resulting in an increase in demand for the US dollar. This has caused the AUD/USD pair to weaken as the Australian dollar loses its appeal to investors.
Lastly, geopolitical tensions and global events can also impact the performance of the AUD/USD pair. Any unexpected event, such as changes in trade policies or political turmoil, can result in increased volatility and uncertainty in the market, leading to a decline in demand for the Australian dollar.
Current Position of the AUD/USD Pair
As of Wednesday, the AUD/USD pair was positioned near the lower end of its daily range, indicating that the pair is currently facing selling pressure. Traders and investors will be monitoring the pair closely in the coming days to gauge its performance and any potential shifts in market sentiment.
In conclusion, the AUD/USD pair is facing selling pressure due to a combination of factors, including the rising number of COVID-19 cases in Australia, the surge in US Treasury yields, and geopolitical tensions.