AUD/USD consolidates daily losses above 0.7000 on RBA Minutes

• AUD/USD portrays corrective pullback from intraday low after mixed RBA Minutes.
• RBA Minutes suggests the policymakers’ acceptance of higher rates but not ignoring the incoming data.
• Economics fears surrounding China, the US exert additional downside pressure.
• US housing, activity data can entertain traders, risk catalysts are the key.

AUD/USD pares intraday losses around 0.7020 after the Reserve Bank of Australia’s (RBA) Minutes of the latest monetary policy meeting. In doing so, the Aussie pair struggles to justify its risk-off mood amid firmer signals from the Minute statement.

RBA Minutes mentioned that the board expects to take further steps in the process of normalizing monetary conditions over the months ahead, but it is not on a pre-set path, per Reuters.

Also read: RBA Minutes: Ready to take further tightening steps but not on a pre-set path

Contrary to the RBA Meeting Minutes, sour sentiment also weighs on the AUD/USD prices due to the pair’s risk-barometer status.

Concerns surrounding the economic health of Australia’s largest trading partner China join the fears of the US recession to act as the key negative for the market’s mood.

The growth fears recently gained momentum after China released downbeat Retail Sales and Industrial Production data for July on Monday. On the same were data suggesting a lack of credit demand for China’s easy loan funds and the surprise rate cut from the People’s Bank of China (PBOC).

On the other hand, US NY Empire State Manufacturing Index for August dropped to 31.3 in August from 11.1 in July and 8.5 market forecasts. Further, the US August NAHB homebuilder confidence index also fell to 49 versus 55, its lowest level since the initial months of 2020.

It’s worth noting that the recently downbeat inflation data from the US contrasts the Fed policymakers’ hawkish bias, as well as the latest weakness in the statistics, to keep AUD/USD bears hopeful.

Against this backdrop, the US 10-year Treasury yields snaps a two-day downtrend around 2.79% while the S&P 500 Futures decline 0.25% intraday at the latest.

To sum up, AUD/USD remains on the bear’s radar, despite the latest rebound, as traders await Wednesday’s Federal Open Market Committee (FOMC) meeting minutes. For today, US Building Permits, Housing Starts and Industrial Production numbers for July should direct intraday moves.

Technical analysis

AUD/USD rebound remains elusive unless crossing the 200-DMA resistance near 0.7120.