AUD/USD rises toward 0.7500 as USD weakens on Powell's remarks

• AUD/USD gains traction in the early American session.
• FOMC Chairman Jerome Powell adopts a dovish tone in his prepared remarks.
• US Dollar Index stays deep in the negative territory below 92.50.

After dropping to a daily low of 0.7433 during the European trading hours, the AUD/USD pair reversed its direction in the early American session and climbed to a session high of 0.7486. As of writing, the pair was up 0.47% on a daily basis at 0.7480.

DXY drops below 92.50 on Powell's prepared remarks

The renewed USD weakness seems to be fueling AUD/USD's upside. Ahead of his testimony before Congress, the Federal Reserve published FOMC Chairman Jerome Powell's prepared remarks and the dovish tone triggered a USD selloff.

Powell is set to reiterate that the monetary policy will continue to deliver powerful support until the economic recovery is complete. Moreover, Powell will note that the job market is still a ways off from the progress needed to start reducing asset purchases.

Reflecting the negative impact of these remarks on the greenback, the US Dollar Index is down 0.4% on a daily basis at 92.40.

Meanwhile, the data published by the US Bureau of Labor Statistics revealed that the Producer Price Index (PPI) jumped to 7.3% on a yearly basis from 6.6% in May. This print surpassed the market expectation of 6.8% by a wide margin but failed to help the USD preserve its strength.

Investors are now waiting for Powell to respond to questions after presenting the Fed's semiannual report at 1600 GMT.

Technical levels to watch for