The Australian dollar pares losses versus the USD, trading near 0.7120, as markets await key US inflation figures.
The AUD/USD pair rebounded from a one-week low of 0.7100, climbing to around 0.7120 in early European trading. The recovery follows an intraday slide but leaves the currency down for a second consecutive session.
Prior to the bounce, the pair hit its lowest level since last week, reflecting broader USD strength and cautious sentiment ahead of the US Personal Consumption Expenditures (PCE) price index release. The data is closely watched as a key inflation gauge for the Federal Reserve.
Markets remain cautious, with the AUD still vulnerable to further downside if US inflation surprises to the upside.