• AUD/USD attracts fresh sellers on Wednesday as a combination of factors underpins the USD.
• The Iran uncertainty and rising Fed rate hike bets continue to act as a tailwind for the buck.
• Spot prices move little following the release of in-line China’s RatingDog Manufacturing PMI.

The AUD/USD pair struggles to capitalize on the previous day's goodish rebound from the 0.6865 region, or a three-month low, and meets with a fresh supply during the Asian session on Wednesday. Spot prices weakened back below the 0.6900 mark in the last hour and moved little following the release of China's private manufacturing PMI.

The latest data published by RatingDog showed that China's Manufacturing PMI eased to 51.7 in June from 52.2 in May. This comes on top of official PMIs released on Tuesday, which showed that business activity barely expanded last month on the back of sluggish domestic demand and weak consumer spending, and undermines the China-proxy Aussie. This, along with a modest US Dollar (USD) uptick, exerts some downward pressure on the AUD/USD pair.

The uncertainty over US-Iran talks benefits the Greenback's relatively safe-haven status amid hawkish US Federal Reserve (Fed) expectations. US negotiators Jared Kushner and Steve Witkoff arrived in Qatar on Tuesday for talks about the implementation of an initial deal to end the war in Iran. The latter, however, said that it would not meet with US envoys, clouding the prospects for lasting peace between the two countries and keeping geopolitical risk premiums in play.

Meanwhile, the US Job Openings and Labor Turnover Survey (JOLTS) showed on Tuesday that job openings edged up to a two-year high level of 7.594 million at the end of May, pointing to a still resilient labor market. Moreover, renewed US-Iran hostilities have revived inflation fears, boosting bets for an imminent rate hike by the US Federal Reserve (Fed). This is seen as another factor acting as a tailwind for the USD and contributing to the AUD/USD pair's slide.

Traders now look to Fed Chairman Kevin Warsh's appearance at the European Central Bank (ECB) Forum in Sintra. Adding to this, Wednesday's US economic docket, featuring the release of the ADP report on private-sector employment and the ISM Manufacturing PMI, should provide some impetus later during the North American session. The focus will then shift to the key US monthly jobs data – popularly known as the Nonfarm Payrolls (NFP) report on Thursday.