Australian Dollar Appreciates As Strong Inflation Spurs Rate Hike Expectations
The Australian dollar advanced against its major counterparts in
the Asian session on Wednesday, as the nation's core inflation
accelerated to a six-year high in the third quarter, fueling hopes
that the the Reserve Bank of Australia may tighten monetary policy
earlier than projected.
Data from the Australian Bureau of Statistics showed that
Australia's consumer prices rose 3 percent on year in the third
quarter, after a gain of 3.8 percent in the previous quarter. The
rate was expected to rise to 3.1 percent.
On a quarterly basis, inflation gained 0.8 percent, matching
forecasts and unchanged from last month.
The Reserve Bank of Australia's trimmed mean grew 0.7 percent on
quarter, exceeding expectations for 0.5 percent, which would have
been unchanged from the second quarter.
The annual rate gained to 2.1 percent - beating forecasts for
1.8 percent and up from 1.6 percent in the three months prior. The
reading was the highest since 2015.
Traders awaited policy announcements from the European central
bank and the Bank of Canada for policy clues in the wake of growing
Solid earnings and economic data underpinned sentiment,
tempering fears about growth.
The aussie climbed to a 6-day high of 0.7536 against the
greenback from Tuesday's close of 0.7496. On the upside, 0.78 is
possibly seen as its next resistance level.
The aussie rose to a 6-day high of 86.06 against the yen and
near a 7-month high of 1.5398 against the euro, up from Tuesday's
closing values of 85.56 and 1.5449, respectively. The aussie is
seen finding resistance around 88.00 against the yen and 1.50
against the euro.
The aussie spiked up to a 1-1/2-month high of 0.9336 against the
loonie and near a 2-week high of 1.0518 against the kiwi, compared
to yesterday's closing values of 0.9286 and 1.0461, respectively.
The aussie is likely to find resistance around 0.96 against the
loonie and 1.075 against the kiwi.
Looking ahead, Swiss economic sentiment index for October is set
for release in the European session.
Chancellor Rishi Sunak will present his Autumn Budget at 8:30 am
U.S. durable goods orders and wholesale inventories for
September will be out in the New York session.
The Bank of Canada will announce its interest rate decision at
10:00 am ET. The BoC is widely expected to keep its policy rate
steady at 0.25 percent.
Euro vs AUD (FX:EURAUD)
From Nov 2021 to Dec 2021
Euro vs AUD (FX:EURAUD)
From Dec 2020 to Dec 2021