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AUD/USD slips near 0.7010 as US inflation cooling tempers the dollar

The US CPI fell 0.4% month over month in June and the annual rate eased to 3.5%, while ADP’s four-week average employment measure declined to 16.5K from 19.25K.

Reported · Written up by our desk · Major Pairs

AUD/USD traded lower near 0.7010 on Tuesday, backing away from a four-week high while the Australian dollar held above the 0.7000 level, according to FXStreet. Softer US economic data limited demand for the US dollar even as investors weigh escalating Middle East tensions and oil-driven safe-haven flows.

FXStreet said the greenback stayed broadly steady as inflation expectations cooled after June data. US consumer prices declined 0.4% month over month, with the annual rate moderating to 3.5%, and weaker producer-price figures reinforced the less hawkish inflation picture.

Additional labor-market signals pointed to moderation, with the ADP Employment Change four-week average dropping to 16.5K from a revised 19.25K. The report helped prevent the dollar index from extending gains, with the DXY holding close to 101.00 after reaching its highest level since July 15.

Market focus is now on Australia’s June employment report due Thursday. FXStreet cited expectations for employment to rise by 15K after a previous increase of 40.3K, with the unemployment rate forecast to stay at 4.4% and the participation rate expected to hold at 66.7%.

Latest closeDollar index 100.71 ▲0.2%

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