AUD/USD edges lower to 0.6740 area as Greenback gains traction
- Tuesday's data showed business conditions in Australia improved in September.
- Producer Price Index (PPI) in the United States (US) declined in September.
- US Dollar Index recovers toward the 99 mark despite the uninspiring data.
The AUD/USD pair lost 30 pips on the first trading day of the week but recovered its losses during the Asian trading hours on Tuesday. However, with the Greenback starting to gather strength in the last hour, the pair eased from its daily highs and was last seen trading at 0.6740, still adding 0.15% on a daily basis.
The National Australia Bank's (NAB) Business Conditions Index in September improved to 2 from 1 in August and helped the Aussie recover its losses. Additionally, the sharp upsurge witnessed in the NZD/USD pair also provided an additional boost to the positively correlated AUD/USD pair.
On the other hand, heightened fears over the United States (US) and China failing to reach an agreement at this week's high-level trade talks forced the pair to lose its bullish momentum.
USD stays resilient against its major rivals on Tuesday
Meanwhile, the Greenback spent the first half of the day under modest selling pressure and allowed the pair to remain near its daily highs. After the data published by the US Bureau of Labor Statistics on Tuesday revealed that the Producer Price Index (PPI) in September declined by 0.3%, the US Dollar Index edged lower before gaining traction in the last hour.
Although there were no significant fundamental drivers that could have helped the Greenback gather strength, the fact that major European currencies face heavy selling pressure seems to be helping the USD find demand in the American trading hours. As of writing, the index was posting modest daily gains at 99.02.
Technical levels to watch for