AUD/USD moves away from one-month high ahead of US data, Australian CPI on Wednesday

• AUD/USD retreated from over a one-month high amid the emergence of fresh USD buying.
• The risk-off mood benefitted the safe-haven buck and weighed on the risk-sensitive aussie.
• Traders now eye US consumer confidence data for some impetus ahead of Australian CPI.

The AUD/USD pair is seen retreating further from over a one-month high, around the 0.6980-0.6985 region touched this Tuesday. The emergence of fresh US dollar buying turned out to be a key factor exerting downward pressure and dragged spot prices back closer to the 0.6900 mark during the early North American session.

The market sentiment remains fragile amid growing worries about a possible global recession. This, along with the pre-Fed nervousness, tempered investors' appetite for perceived riskier assets. This was evident from a weaker tone around the equity markets, which boosted demand for the safe-haven US dollar and weighed on the risk-sensitive aussie.

The global flight to safety, meanwhile, triggered a steep intraday slide in the US Treasury bond yields, which might cap the USD and lend support to the AUD/USD pair. Investors might also prefer to wait on the sidelines ahead of this week's heavyweight US macro data and the highly anticipated FOMC monetary policy decision on Wednesday.

A rather busy week in terms of important US economic releases kick starts with the Conference Board's Consumer Confidence Index on Tuesday. The focus, however, would remain on the outcome of a two-day FOMC policy meeting. The Fed is expected to hike interest rates by another 75 bps and leave the door open for further policy tightening.

Heading into the key central bank event risk, traders would take cues from the quarterly consumer inflation figures from Australia, scheduled during the Asian session on Wednesday. This week's US economic docket also highlights the release of Durable Goods Orders on Wednesday and the Advance Q2 GDP report on Thursday.

This, along with the US Personal Consumption Expenditures (PCE report) - the Fed's preferred inflation gauge - due on Friday will influence the USD and provide a fresh impetus to the AUD/USD pair. In the meantime, traders might refrain from placing aggressive bets, warranting caution before confirming that the recent move up has run out of steam.

Technical levels to watch