AUD/USD extends losing streak for fourth trading day, Fed Powell’s speech in focus

• AUD/USD declines for fourth straight trading day ahead of preliminary US S&P Global PMI data for August.

• The Australian PMI for August came in stronger due to robust demand in both manufacturing and the services sector.

• Investors await Fed Powell’s speech at the Jackson Hole Symposium.

The AUD/USD pair extends its losing streak for the fourth trading day on Thursday. The Aussie pair slides to near 0.6415 in the European trading session, the lowest level seen in almost two months.

The Australian Dollar (AUD) faces selling pressure even as preliminary Australian S&P Global Purchasing Managers’ Index (PMI) data for August came in stronger. The Composite PMI increased to 54.9 from 53.8 in July, led by a significant growth in activities in manufacturing and the services sector.

Meanwhile, the US Dollar (USD) trades sideways ahead of flash United States (US) S&P Global PMI data for August, which will be published at 13:45 GMT. At the time of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades close to the weekly high near 98.40.

Economists expect the Manufacturing PMI is expected to come in at 49.5, down from 49.8 in July, suggesting that the activity contracted at a faster pace. The Service PMI is also seen lower at 54.2 from the prior release of 55.7.

This week, the major trigger for the US Dollar will be Federal Reserve (Fed) Chair Jerome Powell’s speech at the Jackson Hole (JH) Symposium on Friday. Ahead of Fed Powell’s speech, traders are confident that the central bank will cut interest rates by 25 basis points (bps) to 4.00%-4.25%, according to the CME FedWatch tool.

The Federal Open Market Committee (FOMC) minutes of the July policy meeting showed on Wednesday that a majority of officials, including Jerome Powell, argued in favor of holding interest rates steady until they get clarity on the “magnitude and persistence of higher tariffs’ effects on inflation”.