AUD/USD renews 18-month highs near 0.7270

• AUD/USD continues to push higher toward 0.7300 on Wednesday.
• US Dollar Index struggles to stage a recover following Tuesday's slump.
• Markets' focus shifts to FOMC July Meeting Minutes.

The AUD/USD pair spent the Asian session moving sideways near 0.7250 but gained traction in the last hours to touch its highest level since February 2019 at 0.7276. As of writing, the pair was up 0.4% on a daily basis at 0.7270.

USD remains on the back foot ahead of FOMC Minutes

The heavy selling pressure surrounding the greenback provided a boost to AUD/USD on Tuesday. With the 10-year US Treasury bond yield losing more than 2% on Wednesday, the US Dollar Index (DXY) struggles to recover its losses and allows the pair's bullish momentum to remain intact. At the moment, the DXY is posting modest daily losses at 92.26.

Earlier in the day, the data from Australia showed that the Westpac Leading Index dropped from 0.5% in June to 0.05% in July but was largely ignored by the market participants.

Later in the day, the FOMC will release the July Meeting Minutes. Previewing this event, "while the Fed chairman did not provide any major details on the review or forward guidance, he did suggest that the review will "wrap up… in the near future."," said TD Securities analysts. "We expect the minutes to provide additional colour on how those discussions are evolving."

The US T-bond yields' reaction to the FOMC statement could impact the USD's valuation and become the next catalyst for AUD/USD. There won't be any macroeconomic data releases featured in the Australian economic docket.

Technical levels to watch for