AUD/USD Soars Following Inflation Report

Australia’s Consumer Price Index (CPI) was released this morning, surpassing expectations and indicating robust inflationary pressures:

  • Quarterly CPI: Actual 1.0%, Expected 0.8%, Previous 0.6%
  • Annual CPI: Actual 3.5%, Expected 3.4%, Previous 3.4%

The stronger-than-expected inflation figures suggest a potential extension of the Reserve Bank of Australia’s tight monetary policy, propelling the Australian dollar higher against other currencies.

From its yearly low against the US dollar recorded on April 19, the Aussie has surged by over 2%.

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Today’s technical analysis of the AUD/USD chart reveals:

  • Price has reached the median of the ascending channel, historically serving as support, now likely to act as resistance.
  • Key support remains at the 0.64 level, aligning with the lower channel boundary.
  • RSI indicator signals overbought conditions.

A short-term correction is plausible after the rapid uptrend, potentially retracing 50% of the A→B impulse.

To gauge the long-term outlook, upcoming US economic data releases will be critical:

  • US GDP, scheduled tomorrow at 15:30 GMT+3
  • Personal Consumption Expenditures (PCE) USA, due on Friday at 15:30 GMT+3.

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