AUD/USD falls back below 0.6450 after hawkish Fed sends USD higher

• AUD/USD takes a step lower and erases Wednesday's gains to trade into the sub-0.6450 region heading into Thursday.
• The Aussie spent most of the day walking steadily higher heading into the Fed rate call.
• Federal Reserve holds steady on rates, but raises their outlook going forward.

The AUD/USD took a header after the Federal Reserve (Fed) had their rate call which saw the US central bank hold their benchmark interest rate steady at 5.5%.

The Greenback (USD) climbed across the board and the Aussie-Dollar pairing spilled across the charts to end Wednesday below where it started. The Fed raised their interest outlook, with the Federal Open Market Committee (FOMC) seeing interest rates at 5.1% at the end of 2024, half a percent higher than their previous forecast of 4.6%.

Read more:

Forex Today: US Dollar strengthens after Fed’s hawkish pause

Fed dot plot points to one more 25 bps hike in 2023 and 50 bps cut in 2024

Thursday will see US Initial Jobless Claims for the week into September 15th, which is forecast to tick up from 220K to 225K, and Aussie Purchasing Manager Index (PMI) figures.

Australian PMIs are scheduled for 23:00 GMT on Thursday, when markets will be heading into the Friday trading session. The Australian composite PMI last printed at a declining 48.0.

Friday will see the American side of PMI figures, which are expected to slightly improve, from 47.9 to an even 48.0 for manufacturing, and from 50.5 to 50.6 for the services component.

AUD/USD technical outlook

The AUD tumbled from the day's high near 0.6510 to close out Wednesday trading just beneath the 0.6450 handle.

Intraday prices are still seeing support from the 200-hour Simple Moving Average, currently rising into 0.6440, and the ball will be in Aussie bulls' courts to try and stage a relief rally.

On the daily candlesticks, the AUD/USD got knocked back from the 34-day Exponential Moving Average in Wednesday trading, and the pair currently sits noticeably bearish, well back from the 100-day SMA currently floating into the 0.6600 level.

The Relative Strength Index (RSI) and the Moving Average Convergence-Divergence (MACD) indicators are drifting into the midrange, with the pair trading into familiar territory on the weekly candles.

AUD/USD daily chart

AUD/USD technical levels