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Australian dollar rises as Treasury buyback counters hawkish Fed minutes
AUD/USD was last around 0.7127, with a US Treasury long-end bond buyback running from September 9 to November 4 while Fed minutes pointed to a potentially more restrictive stance.
The Australian dollar edged higher on Wednesday, gaining over 0.56% versus the US dollar as the dollar slipped, with AUD/USD last trading around 0.7127, according to FXStreet.
FXStreet said the move comes even after the Federal Reserve released hawkish July meeting minutes that highlighted policymakers recognizing inflation as broad-based and noting dissenters favored a more restrictive policy if inflation does not decline.
The outlet pointed to a US Treasury bond buyback focused on the long end, saying the program is designed to modestly influence the yield curve as elevated yields persist, with the buyback scheduled from September 9 to November 4 and long-end purchases expected to be doubled from 2 billion to at least 4 billion.
FXStreet added that traders are watching upcoming data and Fed comments, including Australia’s employment report and a speech by the new Fed chair, Kevin Warsh, at the start of the Jackson Hole Symposium at the end of August.