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Australian dollar steady versus US dollar near 0.7020
AUD/USD held around 0.7020 even as China’s manufacturing and non-manufacturing PMIs both fell back below 50, while hawkish Federal Reserve comments supported the US dollar.
AUD/USD traded around 0.7020 during Friday’s American session, staying under mild pressure despite signs of firmer pricing expectations in Australia, FXStreet reported. The pair remained supported by a stronger US dollar as Federal Reserve officials took a hawkish tone.
The move reflected weakness in China’s business activity data, with the National Bureau of Statistics reporting that China’s Manufacturing PMI dropped to 49.2 in July from 50.3, while the Non-Manufacturing PMI eased to 49.0 from 50.2. FXStreet said the readings reinforced concerns about slowing demand from Australia’s largest trading partner, limiting AUD support.
On the Australian side, the Producer Price Index accelerated to 3.6% year over year in the second quarter from 3.0% previously, pointing to continued pipeline inflation pressure. FXStreet noted the stronger inflation print was not enough to offset the combined drag from China’s weaker PMIs and the dollar’s renewed support.
FXStreet also cited hawkish remarks from Dallas Fed President Lorie Logan, who said policy is not restraining the economy and warned inflation is not on track to return to the Fed’s 2% target, with risks skewed to the upside. The report said AUD/USD was around 0.7025 on the 4-hour chart, holding above closely watched moving averages near 0.7000, with technical levels at 0.7039 and 0.7045 for resistance and support around 0.7025 and 0.6992.