AUD/USD slumps to near 0.6500 as US Dollar snaps five-day losing streak

• AUD/USD tumbles to near 0.6500 as the US Dollar outperforms its peers.
• The US Dollar gains ahead of the US ISM Manufacturing PMI data for August.
• Investors await key Australian Q2 GDP data.

The AUD/USD pair is down 0.7% to near 0.6500 during the late European trading session on Tuesday. The Aussie pair plunges as the US Dollar (USD) outperforms ahead of the release of the United States (US) ISM Manufacturing Purchasing Managers' Index (PMI) data for August, which will be published at 14:00 GMT.

The US Dollar Index (DXY), which tracks the Greenback's value against six major currencies, snaps five-day losing streak and jumps to near 98.40 after bouncing back strongly from the monthly low around 97.50.

The Manufacturing PMI is seen higher at 49.0 against 48.0 in July, suggesting that the business activity contracted again but at a moderate pace. A figure below the 50.0 threshold is considered a contraction in business activity.

This week, US labor market-related data will be key trigger for the US Dollar. Investors will notably monitor the Nonfarm Payrolls (NFP) data to get fresh cues about the current status of job demand.

In August, market expectations for the Federal Reserve (Fed) to cut interest rates in the September policy meeting intensified after the July's NFP report showed a dramatic downward revision in employment numbers of May and June.

In Australia, investors await Q2 Gross Domestic Product (GDP) data, which is scheduled to be published on Wednesday. Economists expect the Australian economy to have grown by 0.5%, faster than 0.2% increase seen in the first quarter of the year. On an annualized basis, the Australian economy is seen rising by 1.6%.