Ella 
The AUD/USD pair ended a three-game losing streak on Wednesday, recovering from its lowest level since mid-November. However, hawkish comments from Fed officials and safe-haven capital inflows may boost the US dollar and limit the short-term upside of AUD/USD.
The Australian dollar gained momentum as Australia’s ASX200 index recovered after ending three consecutive losses. However, the Australian dollar hit a roadblock, possibly due to risk aversion, as investors cautiously awaited Israel’s response to Iran’s air strikes on Saturday. A Reuters report stated that the third meeting of Israel’s war cabinet, originally scheduled for Tuesday, will be postponed to Wednesday to determine the response to an unprecedented direct attack by Iran. Meanwhile, Western allies are considering quickly imposing new sanctions on Tehran to dissuade Israel from escalating the situation further.
The U.S. dollar index (DXY) retreated from a five-month high of 106.51 hit on Tuesday. This pullback may be due to a slight decline in U.S. Treasury yields. Federal Reserve Chairman Jerome Powell said on Tuesday that recent data showed little progress in inflation this year and that it would take longer than expected to reach the 2% target, which may have fueled the hawkish stance and provided support for the dollar. Provides some support.
