AUssie CPI Q4 preview - what to expect in AUD/USD?

Ross J Burland FXStreet

Currently, AUD/USD is trading at 0.7590, up 0.08% on the day, having posted a daily high at 0.7595 and low at 0.7578.

Trump kick starting a rally in the dollar on his make America great again projects sign off's

AUD/USD has suffered the same fate as the rest of the G10' with a resurgence in the dollar on the back of Trump's recent gallop to get the USa looking great again ASAP, for he doesn't do things by halves and has a point to prove to the world.

For the Aussie, domestically it is a big day in respect to the CPI data that is scheduled for release within the next 20 minutes of writing. The price action is better bid currently and in a drift up from the the 0.7573 lows of earlier with eyes on the 0.76 handle on a decent result for the fourth quarter of 2016, and a crucial event considering the RBA's chill-out period and another contraction might have them falling out of their hammock in respect to their interest rate policy as being on hold.

"The Australian Conference Board Leading Economic Index increased 0.5% in November 2016 to 105.3, helping the pair in recovering ground, explained Valeria Bednarik, chief analyst at FXStreet, also noting that early Wednesday, the country will release its Q4 inflation figures, expected little changed from the third quarter figures. "Any kind of deviation will likely affect the pair sharply, with an uptick in figures favoring another leg higher towards the 0.7700 region."

CPI expectations

The 'headline' result is expected at +0.7%, vrs prior was +0.7% and for the y/y, it is expected at 1.6%, vrs prior 1.3%. However, for the 'trimmed mean' and RBA's preferred measure and way below the RBA's target band of 2 - 3% is expected expected 0.5% for q/q vrs prior 0.4% q/q. For the year it is expected is 1.6%, vrs prior 1.7%.

AUD/USD levels

With spot trading at 0.7591, we can see next resistance ahead at 0.7593 (Daily Classic R1), 0.7595 (Daily High), 0.7609 (Weekly Classic R1), 0.7611 (Yesterday's High) and 0.7611 (Daily Classic R2). Support below can be found at 0.7584 (Daily Open), 0.7584 (Monthly High), 0.7584 (Weekly High), 0.7579 (Hourly 20 EMA) and 0.7578 (Daily Low).

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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