AUD/USD renews three-week low near 0.7250 amid risk-off mood

• AUD/USD takes offers to refresh multi-day low, prints three-day downtrend.
• Market sentiment worsens amid coronavirus fears, pre-Fed anxiety and Evergrande woes.
• Light calendar, off in China, Japan restrict moves but bears stay hopeful amid tapering tantrums.

AUD/USD takes offers around 0.7250, down 0.44% intraday while declining to the lowest levels since August 27 amid Monday’s Asian session. In doing so, the risk barometer pair reacts to the sour sentiment amid a light calendar day.

Fears of a Lehman-like collapse of China’s Evergrande and mixed coronavirus updates weigh on the risk appetite of late. Also challenging the mood could be the uncertainty over the US stimulus and debt limit edit, as well as the latest pact among the UK, Australia and the US. Above all, the cautious mood ahead of Wednesday’s Federal Open Market Committee (FOMC) keeps bears hopeful.

Australia marks a third day of easing in the coronavirus infections, recently at 1,506 cases, while Japan also braces to end the virus-led emergency in the key prefectures including Tokyo. However, COVID-19 numbers from New Zealand and China, not to forget India and the UK have been slightly worrisome and hence back the risk-off mood.

Additionally, Friday’s preliminary readings of the US Michigan Consumer Sentiment Index for September eased below 72.20 forecast to 71.0 but stayed above 70.30 prior readouts. The same joins the previously released US Consumer Price Index (CPI) and the escalating Delta covid variant cases to challenge the Fed hawks. Even so, firmer Retail Sales and factory-gate inflation data join the hopes of further stimulus to challenge the easy-money supporters.

That said, Axios recently reported that US Senator Manchin delay President Joe Biden’s spending package vote to 2022. On the contrary, US House Speaker Pelosi said to expect a bipartisan approach to address the debt limit, per Reuters.

Amid these plays, S&P 500 Futures drop 0.30% intraday, down for the third day near the one-month low, by the press time.

Moving on, bears are likely to keep the reins but may be hesitant amid a lack of major data/events and off in China, as well as Japan. It’s worth noting that the Federal Reserve (Fed) monetary policy decision is the key event of the week.

Technical analysis

AUD/USD remains pressured towards 0.7220 support, comprising a one-month-old horizontal line, unless rising back beyond July lows surrounding 0.7290.