AUD/USD pares intraday losses, keeps the red below 0.7500 mark post-US macro releases

• AUD/USD struggled to find acceptance above the 0.7500 mark and edged lower on Thursday.
• The Fed’s hawkish outlook, elevated US bond yields underpinned the USD and exerted pressure.
• A positive risk tone extended support to the perceived riskier aussie and helped limit the downside.
• The pair reacted little to mixed US macro data as the focus remains on geopolitical developments.

The AUD/USD pair recovered a few pips from the daily low and was last seen trading around the 0.7480 region, down nearly 0.20% for the day.

Having struggled to find acceptance above the 0.7500 psychological mark, the AUD/USD pair edged lower on Thursday and eroded a major part of the overnight gains to the highest level since November 2021. The intraday downtick was sponsored by a broad-based US dollar strength, though a generally positive risk tone helped limit deeper losses for the perceived riskier aussie.

The USD continued drawing support from growing acceptance that the Fed would adopt a more aggressive policy response to combat stubbornly high inflation. In fact, a slew of influential FOMC members, including Fed Chair Jerome Powell, raised the possibility of a 50 bps rate hike at the upcoming policy meeting in May. This continued acting as a tailwind for the buck.

The Fed's hawkish outlook was reinforced by elevated US Treasury bond yields, which were further supported by concerns that surging oil prices would put upward pressure on already high inflation. This, along with the lack of progress in the Russia-Ukraine peace negotiations, further benefitted the greenback's relative safe-haven status and weighed on the AUD/USD pair.

On the economic data front, the US Durable Goods Orders fell short of market expectations and declined sharply by 2.2% in February as against the 1.6% rise reported in the previous month. Orders excluding transportation items also contracted 0.6% during the reported month as compared to consensus estimates pointing to modest deceleration in growth to 0.6% from the 0.8% in January.

This, however, was offset by the Weekly Initial Jobless Claims, which fell to 187K during the week ended March 18 from the previous week's upwardly revised reading of 215K. The mixed releases did little to influence the USD or provide any meaningful impetus to the AUD/USD pair as the focus remains glued firmly to fresh developments surrounding the Russia-Ukraine saga.

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