AUD/USD trades higher near the 0.6990 area on Friday, recovering from an earlier pullback as the US Dollar (USD) struggles to gain clear momentum following mixed United States (US) business-activity data.
The preliminary S&P Global Manufacturing Purchasing Managers Index (PMI) eased to 53.8 in July from 53.9, missing the market forecast of 54.5
In contrast, the Services PMI climbed sharply to 53.6 from 51.2, significantly exceeding expectations of 51.0. The figures showed that manufacturing momentum weakened slightly, while activity in the dominant services sector accelerated. The strong services reading may keep United States (US) Treasury yields supported and limit the Australian Dollar’s recovery.
However, the manufacturing disappointment and broader USD consolidation have allowed AUD/USD to regain some ground, with the 4-hour chart showing a modest rebound from recent lows. Investors will now turn their attention to next week’s Federal Reserve (Fed) meeting on July 28–29. The Fed is widely expected to leave interest rates unchanged at 3.50%–3.75%.