AUD/USD attempting to correct from US session lows

• AUD/USD has started to correct but is slowing in Asia.
• AUD/USD bulls stepped in at US session lows, a steeper correction is eyed toward a 50% mean reversion. 

AUD/USD is flat at around 0.6700 in Tokyo, correcting from the US session lows.  In the US data, prices are rising, but more slowly than expected. The PPI data for April increased 0.2% MoM with annual growth now at 2.3% YoY. Petrol prices in the US lifted more slowly than expected, while food prices actually fell. Core prices are now up 3.4% YoY. ´´The data indicates ongoing price pressures in core services,´´ analysts at ANZ Bank explained. 

Elsewhere, the number of Americans filing new claims for unemployment benefits leaped to a 1-1/2-year high last week, and producer prices rebounded modestly in April. US Weekly Initial Unemployment Claims Rose +22,000 to 264,000, showing a weaker labor market than expectations of 245,000.

Domestically, the analysts at ANZ Bank explained that the Western Australian budget estimates a AUD4.2bn surplus in 2022-23, the same as the federal budget.

´´This is AUD 1.8bn larger than was expected in the Mid-Year Financial Projections Statement, published in December 2022. The state treasury forecasts a smaller net operating surplus of AUD3.3bn in 2023-24, AUD1bn lower than in the mid-year update,´´ the analysts explained, adding, ´´the smaller surplus reflects the increase in expenses to provide cost-of-living support and additional investment in front-line service delivery in the health, education and disability services sectors.´´

AUD/USD technical analysis

• AUD/USD Price Analysis: Bulls move in at key support, 0.6720s eyed

A drive into the hourly resistance could equate to a downside continuation towards 0.6670 initially.