Anna 
On Wednesday, the Australian Dollar (AUD) appeared to retrace some of its recent gains, while the US Dollar (USD) faced depreciation due to downward pressure on US Treasury yields, thereby providing support to the AUD/USD pair. However, the decline in the ASX 200 Index added to the pressure on the Australian Dollar.
The Australian Industry Group (AiG) Industry Index for February showed improvement, rising to a reading of -5.3 from the previous -14.9. Similarly, the AiG Manufacturing Purchasing Managers’ Index (PMI) came in at -7, compared to the prior reading of -12.6. According to a summary of the Reserve Bank of Australia (RBA) March meeting minutes by Westpac, the current cash rate level is deemed suitable for the prevailing circumstances, although conditions may evolve in the future.
Meanwhile, the US Dollar Index (DXY) encountered obstacles following dovish remarks from Federal Reserve (Fed) officials. Cleveland Fed President Loretta Mester indicated her anticipation of rate cuts later this year during remarks on Tuesday. Concurrently, San Francisco Fed President Mary Daly expressed her view that three rate cuts in 2024 appear “reasonable,” subject to further convincing evidence to solidify such a decision. These comments contributed to the USD’s depreciation, providing some relief to the AUD.
