AUD/USD Continues Weakening, Market Eyes on Powell's Speech
The AUD/USD pair extended its decline for the fourth day on Thursday (August 21st), briefly dropping to around 0.6415 in the European session—a nearly two-month low. Selling pressure persisted, although some market participants chose to hold positions ahead of a series of US data.
From Australia, preliminary data from the S&P Global PMI for August actually strengthened: the Composite rose to 54.9 from 53.8 in July, driven by more solid manufacturing and services activity. However, this positive sentiment was unable to lift the Aussie, as global sentiment and the direction of the US dollar were dominant.
Meanwhile, the US Dollar Index (DXY) moved sideways but near a weekly high of around 98.40 ahead of the US PMI release (13:45 GMT). Consensus forecasts a Manufacturing PMI of 49.5 (a deeper contraction than 49.8 in July) and a Services PMI of 54.2 (down from 55.7), making the data potentially volatile across asset classes.
This week's main focus is on Fed Chairman Jerome Powell's speech at Jackson Hole on Friday. The market expects the Fed to cut rates by 25 bps to a range of 4.00%–4.25%. The July FOMC minutes showed that most officials—including Powell—are leaning towards holding rates until there is clarity on the impact of tariffs on inflation.
Key Points:
AUD/USD fell for the fourth day, touching ~0.6415 (~2-month low).
Australian PMI (flash): Composite 54.9 (up from 53.8), but did not lift the AUD.
Awaiting US PMI (13:45 GMT): manufacturing 49.5, services 54.2 (estimate).
DXY near weekly high of ~98.40; further direction depends on Powell's speech and expectations of a 25 bps cut. (ayu)
Source: Newsmaker.id
