AUD/USD came under pressure overnight after printing a high of around 1.016 late in the London session.

Early gains came after German investor confidence grew and Spain’s debt auctions impressed. Markets were also anticipating some indication of more quantitative easing from the Fed ahead of its statement. AUD/USD slipped below parity late in the US session, as risk assets were sold off after the Fed refrained from signalling further quantitative easing or further coordinated action with the ECB. There were also reports that German Chancellor Angela Merkel rejected boosting Europe’s permanent bailout fund. This saw AUD/USD print a low of 0.998 this morning. The Westpac/Melbourne Institute consumer sentiment reading for December fell 8.3% after a 6.3% rise in November. Clearly the rate cut wasn’t so great after all. The data saw no move at all in AUD/USD.

Westpac consumer sentiment fell 8.3% in December after a 6.3% rise in November. With pressure firmly to the downside, AUD/USD has broken support, slipping below parity and right near the overnight lows. Traders will be eyeing tomorrow’s China HSBC Flash manufacturing PMI numbers for some direction.