Investing.com - The Australian dollar dropped to fresh six-month lows against its U.S. counterpart on Monday, after the release of downbeat motor vehicle sales from Australia, while expectations for a U.S. rate hike grew stronger ahead of the Federal Reserve's monthly meeting this week.
AUD/USD hit 0.8984 during late Asian trade, the pair's lowest since March; the pair subsequently consolidated at 0.8995, retreating 0.48%.
The pair was likely to find support at 0.8888 and resistance around the 0.9042 level.
Official data earlier showed that Australia's new motor vehicle sales declined by 1.8% last month, after a 1.3% drop in July.
Separately, data over the weekend showed that Chinese factory output and retail sale growth slowed in August, adding to concerns over a slowdown in the world’s second largest economy.
China is Australia's biggest export partner.
Meanwhile, demand for the greenback continued to be underpinned by expectations for an early hike in U.S. interest rates.
The Fed was expected to cut its asset purchase program by another $10 billion at its upcoming policy meeting on Wednesday, which would keep it on track for winding up the program in October, and to start raising interest rates sometime in mid-2015.
The Aussie was also lower against the euro, with EUR/AUD gaining 0.41% to 1.4403.
Later in the day, the U.S. was to release reports on manufacturing activity in the Empire State and industrial production.