Australian Dollar Falls After Weak Inflation Data
28 April 2021 - 1:13PM
RTTF2
The Australian dollar moved lower against its major trading
partners in the Asian session on Wednesday, as the country's
inflation rose less than expected in the first quarter, cementing
expectations that the Reserve Bank of Australia will keep interest
rate at record lows for the forseeable future.
Data from the Australian Bureau of Statistics showed that
Australia's consumer prices rose 0.6 percent on quarter in the
first quarter of 2021.
That was shy of expectations for 0.9 percent, which would have
been unchanged from the three months prior.
On a yearly basis, inflation gained 1.1 percent - also missing
forecasts for 1.4 percent but still up from 0.9 percent in the
previous three months.
Asian stock markets are trading mixed following mixed cues
overnight from Wall Street, as traders refrained from making major
moves ahead of the Federal Reserve's latest monetary policy
decision later today.
The aussie dropped to a 5-day low of 0.7725 against the
greenback from Tuesday's close of 0.7762. The aussie is seen
finding support around the 0.75 mark.
The aussie pulled back to 84.14 against the yen, from a high of
84.52 hit at 7:30 pm ET. The aussie is likely to challenge support
around the 80.00 region, if it drops again.
Data from the Ministry of Economy, Trade and Industry showed
that Japan retail sales climbed 5.2 percent on year in March -
coming in at 13.498 trillion yen.
That beat expectations for an increase of 4.7 percent following
the 1.5 percent decline in the previous month.
The aussie touched 1.5634 against the euro, its lowest level
since April 14. Next key support for the aussie is seen around the
1.60 level.
The aussie that closed yesterday's deals at 0.9624 against the
loonie declined to a 2-week low of 0.9591. Should the aussie falls
further, it is likely to face support around the 0.94 region.
The aussie slipped to its weakest level since March 11 against
the kiwi, at 1.0735. The aussie is poised to challenge support
around the 1.06 mark.
Looking ahead, Swiss economic sentiment index for April is set
for release in the European session.
Canada retail sales for February and U.S. wholesale inventories
and advance goods trade balance for March will be published in the
New York session.
At 2:00 pm ET, the Fed announces its decision on interest rate.
Economists widely expect the federal funds rate to be kept at 0 -
0.25 percent.
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