AUD/JPY advances towards 97.00 on widened RBA-BOJ policy divergence, Aussie GDP eyed

AUD/JPY is eyeing a fresh seven-year high at 97.00 as RBA-BOJ policy divergence widens.
Investors should brace for upbeat Australian GDP data ahead.
A decline in households’ consumption indicates a loss of consumer confidence in the Japanese economy.

Sagar Dua FXStreet

The AUD/JPY pair is aiming to refresh its seven-year high at around 97.00 as a rate hike announcement by the Reserve Bank of Australia (RBA) on Tuesday has widened RBA-Bank of Japan (BOJ) policy divergence. On one side, where the Australian Economy is facing the headwinds of soaring price pressures, the Japanese economy is struggling to elevate the inflation rate led by a slowdown in the overall demand.

On Tuesday, RBA Governor Philip Lowe announced a fourth consecutive rate hike by 50 basis points (bps). Australia’s Official Cash Rate (OCR) now stands at 2.35%. As price pressures have been recorded at 6.1% for the second quarter of CY2022, a spree of rate hikes is highly expected by the RBA. Adding to that, the Australian inflation rate has not revealed signs of exhaustion yet.

Brace for an upbeat Australian GDP data

In today’s session, investors’ entire focus will remain on the Australian Gross Domestic Product (GDP) data. The Australian economy is expected to grow by 1% on a quarterly basis vs. 0.8% recorded in the prior quarter. Also, the yearly data is expected to improve to 3.5% vs. the 3.3% recorded earlier. An occurrence of the same will strengthen the aussie bulls further.

A decline in households’ consumption may restrict the inflation rate

Meanwhile, yen bulls are worried over a decline in the consumption of Japanese households. The Overall Household Spending data released on Tuesday is indicating a decent drop in the households’ demand. The economic data landed at 3.4%, lower than the expectations of 4.2% and the prior release of 3.5%. This indicates households’ pessimism in the Japanese economy and also lower expenditure by the former may restrict the inflation rate.

AUD/JPY

Overview
Today last price	96.3
Today Daily Change	0.73
Today Daily Change %	0.76
Today daily open	95.57

Trends
Daily SMA20	94.69
Daily SMA50	94.03
Daily SMA100	93.28
Daily SMA200	89

Levels
Previous Daily High	95.61
Previous Daily Low	95.03
Previous Weekly High	96.2
Previous Weekly Low	94.71
Previous Monthly High	96.2
Previous Monthly Low	90.52
Daily Fibonacci 38.2%	95.39
Daily Fibonacci 61.8%	95.25
Daily Pivot Point S1	95.2
Daily Pivot Point S2	94.82
Daily Pivot Point S3	94.62
Daily Pivot Point R1	95.78
Daily Pivot Point R2	95.98
Daily Pivot Point R3	96.36

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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