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AUD/USD renews multi-month lows, extends slide toward 0.6700

  • US Dollar Index slides below 98 on Thursday.
  • Concerns over coronavirus outbreak continue to weigh on AUD.
  • US economy is seen expanding by 2.1% in Q4.

The AUD/USD pair continues to push lower during the American session on Thursday as the sour market mood weighs on the risk-sensitive AUD. As of writing, the pair was trading at its lowest level since late September at 0.6712, losing 0.6% on a daily basis.

Antipodeans suffers as coronavirus death toll rises

Heightened concerns over the deadly coronavirus infection spreading and having a significant negative impact on the Chinese economy continue to weigh on China-proxy AUD. According to the latest updates, the death toll hit 170 on Thursday.

Commenting on the potential effect of the coronavirus on the economy, "based on the SARS experience and on the information we have right now, we think that a temporary impact of around 1-2% on GDP is a reasonable estimate," said Rabobank analysts. "If this is largely offset by higher growth in the second half of 2020 the overall impact on annual GDP growth could still be relatively limited (to a few tenths of a percentage point)."

On the other hand, the US Dollar Index is posting modest daily losses below the 98 mark pressured by a sharp upsurge witnessed in the GBP/USD pair. The US Bureau of Economic Analysis on Thursday reported that, according to its initial estimate, the US economy is seen expanding by 2.1% on a yearly basis in the last quarter of the year. 

In the early trading hours of the Asian session on Friday, Private Sector Credit and Producer Price Index data from Australia will be looked upon for fresh impetus.

Technical levels to watch for

 

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