AUD/USD Slides on Renewed US Dollar Strength and China Trade Data
AUD/USD was near 0.6905 on Tuesday, down 0.31% on the session, as the Australian Dollar gave back part of Monday’s rebound against the US Dollar. Pressure on the pair followed firmer expectations of further Federal Reserve tightening and weaker Chinese trade headlines. China’s October trade surplus narrowed to $105.28 billion from $133.53 billion in September and fell short of the $125.8 billion consensus, even as exports and imports still expanded year on year.
Fed Rate Hike Bets, US Inflation and Technical Levels
The US Dollar drew support from shifting policy pricing, with the CME FedWatch tool indicating a 99% probability of a 25-basis-point rate rise in December, up from 84% a day earlier. US inflation data added to the repricing: the CPI rose 0.4% month on month in October versus 0.3% expected, while easing from 0.6% in September; core CPI increased 0.3%, above the 0.2% forecast and matching the prior month. On the daily chart, the pair traded at 0.6878, remaining below the 100-day SMA at 0.7028 and the 200-day SMA at 0.7056, with the 14-day RSI around 38; support levels cited include 0.6894, 0.6855 and the March low at 0.6834.
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