AUD/USD consolidates around 0.7400 mark

• A subdued USD demand assisted AUD/USD to gain some positive traction on Monday.
• A combination of factors acted as a tailwind for the USD and capped any further gains.
• The market focus will be on the latest US consumer inflation figures due on Wednesday.

The AUD/USD pair traded with a mild positive bias through the Asian session, though lacked any follow-through buying beyond the 0.7400 mark.

The pair struggled to capitalize on Friday's goodish rebound from the post-NFP swing lows to multi-week lows and witnessed subdued/range-bound price moves on the first day of a new week. Against the backdrop of the upbeat US monthly jobs report, a solid rebound in the US Treasury bond yields acted as a tailwind for the US dollar and capped the upside for the AUD/USD pair.

Apart from this, a cautious mood around the Asian equity markets further held traders from placing bullish bets around the perceived riskier aussie. That said, the Fed's dovish outlook kept a lid on any meaningful gains for the greenback and extended some support to the AUD/USD pair. It is worth recalling that the Fed last week reiterated that inflation is transitory.

In the post-meeting press conference, Fed Chair Jerome Powell said that policymakers were in no rush to hike borrowing costs. He also added that the current level of inflation is not consistent with price stability and that the central bank would use tools as appropriate to get it under control. Hence, the focus shifts to the US consumer inflation figures due on Wednesday.

In the meantime, the US bond yields, along with the broader market risk sentiment will influence the USD price dynamics and provide some impetus to the AUD/USD pair. Later during the US session, traders will take cues from Powell's remarks at an online conference for some short-term opportunities around the AUD/USD pair.

Technical levels to watch