AUD/USD drops to 0.7620 area, eyes on FOMC Minutes

• AUD/USD lost its traction following a quiet Asian session.
• US Dollar Index struggles to stage a convincing rebound.
• FOMC will release the minutes of its March meeting later in the day.

The AUD/USD pair closed the first two days of the week in the positive territory supported by the broad-based selling pressure surrounding the greenback. After moving sideways during the Asian session on Wednesday, the pair lost its traction and dropped to a daily low of 0.7622. As of writing, AUD/USD was down 0.45% on the day at 0.7627.

Earlier in the day, the data from Australia showed that Commonwealth Bank Services PMI edged higher to 55.5 in March from 53.4. However, this reading missed the market expectation of 56.2. Nevertheless, the market reaction was largely muted.

DXY consolidates losses on Wednesday

On the other hand, the bearish pressure surrounding the US Treasury bond yields seems to have softened on Wednesday. The benchmark 10-year US T-bond yield, which lost more than 3% on Tuesday, is currently flat on the day at 1.647%, allowing the USD to stay resilient against its major rivals. Currently, the US Dollar Index (DXY) is posting small losses at 92.22.

Later in the session, Goods Trade Balance will be the only data featured in the US economic docket. More importantly, the FOMC will release the minutes of its March meeting at 1800 GMT. 

Previewing this publication, "the FOMC minutes will be scoured for clues to the logic, timing and size of any change to the Treasury intervention," noted FXStreet Analyst Joseph Trevisani. "Any notice that the conditions for a reduction in bond purchases were discussed will be taken as an indication that the time is approaching with commensurate market impact."

Technical levels to watch for