Ella 
The Australian dollar fell for the eighth straight session against the U.S. dollar after mixed readings from Australia’s Judo Bank Purchasing Managers’ Index (PMI) for July released on Wednesday. Weak economic activity in China also put additional selling pressure on the AUD. Concerns about China’s weak economy were exacerbated by the People’s Bank of China’s unexpected rate cut on Monday.
In addition, the weak outlook for China’s economic weakness led to a fall in iron ore prices, further pressuring the AUD. Iron ore prices fell to a three-week low of $108.00. The decline was particularly felt in Australia, the largest exporter of the precious metal.
The U.S. dollar is likely to struggle as bets on a September rate cut by the Federal Reserve rise, which could limit the AUD/USD pair’s losses. Traders await the release of global PMIs on Wednesday for information on the state of the U.S. economy.
According to CME Group’s FedWatch Tool, the market is currently pricing in a 93.6% probability of a 25 basis point rate cut by the Federal Reserve at its September meeting, compared to 88.5% a day ago.
