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AUD falls from two-week highs as Manafort, Cohen news hits sentiment

The AUDUSD saw a dramatic reversal lower this morning after the US administration faced turmoil with personal lawyer Michael Cohen pleading guilty to campaign finance violations and campaign director Paul Manafort found guilty of fraud.

Earlier, the Australian dollar was higher across markets as US shares hit record highs.

The benchmark S&P 500 hit all-time highs as it recovered the heavy losses inflicted back in February.

The AUD was boosted by the improved sentiment.

Markets take fright

The AUDUSD gained 0.4% yesterday before turning lower in early Wednesday trading following the US political news.

The Aussie was weaker in other markets with the euro and British pound both higher. The AUDEUR fell 0.9% while the AUDGBP fell 0.4%.

Both pairs saw further losses in early trade today.

The AUDJPY had a solid session yesterday before easing on US political fears.

Fed focus

The main focus over the next 24 hours will be US Federal Reserve minutes due at 4.00am AEST.

The recent Turkey-related sell-off saw the probability of a fourth and final Fed rate hike in 2018 fall from 75% to 55% (source: Reuters).

Tonight’s Fed minutes will be closely watched for signs of the Fed’s next move.

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