- AUD / USD struggles to find direction on Tuesday.
- The US dollar index recovered slightly after falling below 93.00.
- Consumer confidence in the United States continued to deteriorate in August.
AUD / USD rose towards 0.7200 during European trading hours, but lost traction as the greenback began to strengthen during the US session. At the time of writing, the pair was up 0.15% on a daily basis to 0.7172.
DXY Bounces Above 93.00 On Soaring US T Bond Yields
Earlier today, the bullish market mood regarding easing US-China tensions helped the risk-sensitive AUD find demand. Additionally, the US Dollar Index (DXY), which closed in positive territory on Monday, fell below 93.00 and helped the pair maintain its bullish momentum.
However, the sharp rise in US Treasury bond yields helped the DXY rebound and caused the pair to reverse direction. For now, the yield on US 10-year T bonds is up 6.6% on the day and the DXY is posting small daily losses at 93.19.
Earlier today, data from the United States showed the Conference Board’s consumer confidence index fell to 84.8 in August from 93 in July. Nonetheless, this reading had little to no impact on the market valuation of the USD.
Commenting on the data, “Consumer confidence is weaker now than it was in April and May at the height of the lockdowns,” Wells Fargo analysts noted. “While there isn’t a long enough time series to make a rock-solid case, it seems trust is holding back progress with the virus, at least to some extent.”