AUD/USD Strengthens Near 0.6550 as US Dollar Weaken
The AUD/USD pair attracted some buyers near 0.6540 during the early Asian session on Monday (11/25). The US Dollar Index (DXY) eased slightly after hitting a fresh two-year high despite strong S&P US Purchasing Managers’ Index (PMI) data. On Monday, the US Chicago Fed National Activity Index for October and the Dallas Fed Manufacturing Business Index for November will be released.
Upbeat US November PMIs failed to boost the greenback. Data released by S&P Global showed on Friday that the S&P US Global Composite PMI rose to 55.3 in the flash estimate for November from 54.1 in October. Meanwhile, the Manufacturing PMI improved to 48.8 in November from 48.5 in October but remained in contraction. The Services PMI rose to 57.0 in November from 55.0 in the previous reading, beating the estimate of 55.3
However, rising expectations of a less aggressive rate cut from the Federal Reserve (Fed) may support the USD. Futures traders are now pricing in a 50.9% chance that the Fed will cut rates by a quarter point, down from around 69.5% a month ago, according to data from the CME FedWatch Tool.
On the Australian side, Australia’s Judo Bank Composite PMI unexpectedly contracted in November, falling to 49.4 in November from 50.2 previously. A reading below the 50.0 threshold is considered a contraction in economic activity. The Manufacturing PMI improved to 49.4 in November from 47.3 in October, while the Services PMI fell to 49.6 in November from the previous reading of 51.0.
Source: FXStreet
