Anna 
The AUD/USD pair witnessed a mild rebound, moving away from sub-0.6500 levels on Wednesday and distancing itself from a three-week low recorded in the prior session. The pair reached around the 0.6525 region in the early European session, displaying a lack of strong bullish momentum.
The Australian Dollar (AUD) received a slight boost in response to positive comments from China’s National Development and Reform Commission (NDRC). The NDRC expressed optimism, stating that China’s 2024 growth target aligns with economic potential. Additionally, the NDRC anticipates a robust start to Q1 and expects a consolidated and strengthened recovery. People’s Bank of China (PBoC) Governor Pan Gongsheng also mentioned that there is ample room for monetary policy adjustments, including the possibility of cutting the reserve requirement ratio (RRR). These statements overshadowed less impressive domestic data, revealing a modest 0.2% growth in Australia’s economy for the December quarter.
Furthermore, a slight weakness in the US Dollar (USD) contributed to the AUD/USD pair’s upward movement. Markets are currently pricing in a higher likelihood, approximately 70%, of the Federal Reserve (Fed) implementing its first interest rate cut in June. The recent US ISM PMI data showed a slowdown in services sector growth in February, keeping USD bulls on the defensive and supporting the AUD/USD pair’s intraday recovery. Traders, however, may exercise caution before making significant USD bearish bets, awaiting fresh insights from Fed Chair Jerome Powell’s congressional testimony.
On Wednesday, market participants will focus on the US ADP report on private-sector employment and JOLTS Job Openings data during the early North American session. These releases, coupled with broader risk sentiment, will influence USD dynamics and offer short-term trading opportunities for the AUD/USD pair. Attention will then shift to China’s trade balance data on Thursday, followed by the eagerly anticipated US Nonfarm Payrolls (NFP) report on Friday. Despite a two-day losing streak being snapped, spot prices remain sensitive to USD price movements for the time being.
