AUD/USD attempts to build a cushion around 0.6850 on upbeat Aussie Retail Sales data
- AUD/USD will likely display a short-lived pullback on better-than-expected Aussie Retail Sales data.
- Aussie Retail Sales have landed at 1.3% vs. the consensus of 0.3%
- The DXY has refreshed its two-decade high at 109.32 on soaring risk-off.
The AUD/USD pair has sensed buying interest near 0.6850 as the Australian Bureau of Statistics has reported upbeat Retail Sales data. The economic data has landed at 1.3%, higher than the consensus and the prior release of 0.3% and 0.2% respectively.
The investing community should be aware of the fact that the Australian economy is facing the wrath of soaring inflation. Price pressures in the Australian economy have reached to 6.1%, which indicates that the households in the Aussie area are already making higher payouts for similar or with limited changes in quantity purchased. The Retail Sales data is upbeat and it could be stated that the overall demand is accelerating in the Australian economy.
On the dollar front, the US dollar index (DXY) is advancing firmly on soured market sentiment. After preferring inflation fix over lower growth forecasts by the Federal Reserve (Fed), the risk-off market mood has underpinned the DXY. The DXY is expected to recapture its two-decade high, recorded on July 14 at 109.29.
Considering the necessary fundamental concepts, the decision of fixing inflation chaos foremost rather than delighting the optimism seems mature. The US inflation rate is skyrocketing, and a one-time exhaustion signal is not enough to provide a sit-back and relaxed situation for Fed policymakers.
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.
