AUD/USD seeks more gains above 0.6650 despite subdued Aussie PMI data

• AUD/USD is expected to deliver more gains above 0.6650 amid a cheerful market mood.
• Aussie Manufacturing and Services PMI have dropped to 52.4 and 49.1 respectively.
• Going forward, FOMC minutes and US Durable Goods Orders will be of significant importance.

The AUD/USD pair is hovering around the critical hurdle of 0.6650 in the early Asian session. The asset is expected to extend its gains above the aforementioned hurdle despite a decline in Aussie S&P PMI data.

The S&P Global Manufacturing PMI has dropped to 52.4 against the former release of 52.7 and the Services PMI has declined to 49.1 in comparison with 49.3, the prior release. A decline in PMI numbers could have a harsh impact on the Aussie dollar but may add to the slowdown filters for inflation.

The economic activities could have been impacted due to a fall in consumer spending led by rising inflation and accelerating interest rates. This may force goods and services providers to favor a decline in price growth ahead.

Meanwhile, a significant recovery in the risk-on profile as investors have shrugged off uncertainty amid rising Covid-19 infections in China has supported the antipodean. However, the US dollar index (DXY) has witnessed the termination of the three-day winning streak. The mighty DXY has dropped below 107.20 and is expected to remain on tenterhooks ahead amid uncertainty over the release of the Fed Open Market Committee minutes (FOMC), which will release on Thursday.

But before that, US Durable Goods Orders data will be of utmost importance. The economic data is seen as stable at 0.4%. An improvement in demand for durable goods could dampen the efforts of the Fed chair Jerome Powell who is working hard to slow down consumer spending.

On the Aussie front, mixed commentary from the Reserve Bank of Australia (RBA) Governor Philip Lowe on the interest rate guidance has created ambiguity in the minds of investors. While delivering a speech titled "Price Stability, the Supply Side, and Prosperity" at the Annual Committee for Economic Development, RBA Governor cited the absence of a pre-set path and stated that the central bank could return to a 50 bps rate hike or keep policy stance ‘unchanged’ for a period of time.