AUD/USD drops to weekly lows near 0.6870 on US-China trade headlines
- Ongoing discussions on terms could reportedly delay signing of US-China trade deal.
- US Dollar Index posts modest daily gains near the 98 mark.
- Unit Labor Costs in the US rose more than expected in the third quarter.
The AUD/USD pair came under renewed bearish pressure in the last hour with the latest headlines surrounding the United States (US)-China trade dispute weighing on the antipodeans and fell to a fresh weekly low of 0.6869. As of writing, the pair was trading at 0.6875, down 0.25% on the day.
No US-China trade deal in November?
Citing a senior Trump administration official, Reuters on Wednesday reported that the signing of the phase-one of the US-China trade deal could be delayed until December amid ongoing discussions on terms and venue. On a positive note, "China's push for more tariff rollbacks is not seen derailing progress toward a trade deal," the official noted but the market reacted negatively nevertheless.
The NZD/USD pair lost more than 20 pips, Wall Street's main indexes turned negative on the day and the 10-year Treasury bond yield continued to push lower.
The dismal mood also allowed the USD to gather strength against its risk-sensitive rivals and further weighed on the pair. At the moment, the index is up 0.06% on the day at 97.95.
In the early trading hours of the Asian session, the AiG Performance of Construction Index and Trade Balance data from Australia will be released but the market is likely to stay focused on fresh developments on US-China trade conflict.
Technical levels to watch for