The Australian dollar extended its decline against the US dollar on Friday. AUD/USD traded around 0.6775 at the time of writing, down 0.43 percent on the day, as rising US Treasury yields and expectations of further Federal Reserve rate hikes weighed on the currency. By our market data, the pair stood at its lowest in 31 days as of 13:09 GMT.
Inflation data keeps pressure on
US core consumer prices rose 0.3 percent month on month in October, above the 0.2 percent expected. It was the third consecutive monthly gain of 0.3 percent. Producer prices also rose 0.3 percent, below the 0.4 percent forecast.
Deutsche Bank strategists said the latest figures put the annualised pace of core inflation over the past three months at 3.75 percent, its fastest rate since April 2024. The 10-year Treasury yield reached 5.14 percent, its highest in three weeks.
Goolsbee warns the Fed has more to do
Chicago Fed President Austan Goolsbee said inflation was spreading beyond energy-related sectors. He said the central bank still had work to do to restore price stability. Worsening inflation data could justify a more aggressive policy response, he added.
The Reserve Bank of Australia appears to have completed its tightening cycle, the article notes.
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Technical picture stays weak
AUD/USD is trading below its 100-day and 200-day simple moving averages, at 0.7025 and 0.7053. The pair sits just above horizontal support at 0.6766. The 14-day Relative Strength Index is at 30.7, close to oversold territory.
Related: Aussie dollar slips below $0.6850 on Fed rate-hike bets · Peso slips to 18.63 per dollar as Fed hike odds rise
Source: Federal Reserve | Data: Swissquote
