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AUD/USD edges higher near 0.7175 as USD slips on US buyback worries
The US Treasury could expand longer-dated bond buybacks beyond $4 billion, a plan that market strategist Marc Chandler said is undermining the dollar.
FXStreet said AUD/USD trades modestly higher around 0.7175 in early Asian trading, with the US dollar edging lower against the Australian dollar amid concerns about the US Treasury expanding buybacks of longer-dated government debt.
According to FXStreet, US Treasury Secretary Scott Bessent said the Treasury could increase bond buybacks beyond $4 billion, partly to signal that current yields do not reflect underlying economic fundamentals. The report added that the department previously pledged to at least double longer-dated debt buybacks to help rein in bond yields.
FXStreet also cited comments from Bannockburn Global Forex strategist Marc Chandler, who said efforts to suppress US yields have not done much for yields but have undermined the dollar. The outlet noted that rising Middle East tensions could still support safe-haven demand for the USD.
On Australia, FXStreet pointed to Reserve Bank of Australia meeting minutes scheduled for Tuesday and highlighted a negative surprise in the latest labour market report, citing 15.8k job losses in July versus analysts expecting a 12k jobs increase. The report said the move keeps AUD/USD supported technically above the 100-day simple moving average near 0.7072, while the RSI around 70.0 suggests overbought conditions.