The Australian dollar fell 0.17 percent against the US dollar to trade at 0.7017 on Thursday, as US tech stocks slid on worries about AI valuations and oil climbed on the escalating US-Iran conflict.
Australia’s services sector contracted sharply. The S&P Global services PMI dropped from 51.9 to 47.5, while the manufacturing gauge edged up from 49.6 to 49.7.
Central bank bets shift
Money markets now price a 57 percent chance of a Reserve Bank of Australia rate increase at its November meeting. Deputy Governor Hauser said monetary policy is working, but the inflation outlook has worsened.
S&P Global Market Intelligence economics associate director Jingyi Pan linked the services downturn to higher prices and rising interest rates eroding demand, based on comments gathered from companies.
Risk sentiment and the dollar
Some investors rotated out of stocks and into US Treasuries, which weighed on the greenback. The dollar index was little changed at 101.61.
Attention now turns to the University of Michigan consumer sentiment survey and the Federal Reserve’s policy meeting next week, with Core PCE due on October 29.
Related: Mexican peso slips as inflation rises and Iran tensions weigh
Data: Swissquote
