AUD/USD tumbles toward 0.6600 after FOMC’ s minutes ahead of Aussie PMIs

• AUD/USD tumbled more than 0.60% on Wednesday due to FOMC turning hawkish.
• Fed minutes hint at possible rate hikes if inflation risks increase, boosting US Treasury yields and the Dollar.
• Australian economic agenda includes Judo Bank Manufacturing and Services PMIs, showing mixed preliminary results for May.
• Upcoming US data: unemployment claims and S&P Global PMIs could influence AUD/USD.

The Australian Dollar registered losses against the US Dollar of 0.69% after the Federal Reserve hinted at raising rates if inflation warranted it, according to the latest meeting minutes. Therefore, US Treasury yields edged up, while the Greenback rose more than 0.20%, as depicted by the US Dollar Index (DXY). As Thursday’s Asian session begins, the AUD/USD trades at 0.6618, down 0.03%.

AUD/USD falls as Fed minutes suggest potential rate hikes, Australian PMI eyed

US equities finished Wednesday mixed ahead of NVIDIA’s earnings release. Global bond yields rose after inflation in the UK dipped, but it was above estimates, diminishing the odds of the Bank of England lowering rates.

Across the pond, the latest FOMC minutes revealed, "Various participants mentioned willingness to tighten policy further should risks to outlook materialize and make such action appropriate.”

The FOMC Minutes revealed that Fed officials remain uncertain about the current degree of policy restrictiveness. They noted that "it would take longer than previously anticipated to gain greater confidence in inflation moving sustainably to 2%."

On the Aussie’s front, Thursday’s economic docket will feature the release of the Judo Bank Manufacturing and Services PMIs final readings for May. The preliminary reading showed that manufacturing activity remained in contractionary territory yet improved from 47.3 to 49.6, while the services index remained in expansionary territory, still dipping from 54.4 to 53.6.

On the US front, unemployment claims for the week ending May 18, alongside the release of the S&P Global PMIs, could spark some movement in the AUD/USD pair.

AUD/USD Price Analysis: Technical outlook

After trading within a narrow range of 0.6640-0.6700, the AUD/USD cleared the bottom of the range and extended its losses toward the 0.6610 region. It should be said that buyers are losing steam, as the Relative Strength Index (RSI) turned flat despite being in bullish territory, opening the door to testing lower price levels.

The AUD/USD first support would be 0.6600. A breach of the latter will expose the 100-day moving average (DMA) at 0.6562, followed by the 50 and 200-DMAs each at 0.6553 and 0.6526. Conversely, if buyers regain control, and push prices above 0.6640, that could pave the way toward 0.6700.