Breaking: Australian inflation, CPI, beats expectations and sends AUD on a tear

FXStreet Team FXStreet

Australia’s critical first quarter Consumer Price Index data is out and the data has beaten expectations, lifting AUD higher towards a key resistance target on the hourly chart.

The data is key because the Australian central bank has dropped its patient stance and announced monetary policy would be data-dependent.

Australian quarterly inflation was expected to surpass the upper end of the RBA’s target.

Aussie CPI

Q1trimmed mean CPI +1.4 pct QoQ (Reuters poll +1.2 pct).
Q1 CPI (all groups) +2.1 pct QoQ (Reuters poll +1.7 pct).
Weighted median CPI +1 pct QoQ (Reuters poll +1.1 pct).
Trimmed mean CPI +3.7 pct YoY (Reuters poll +3.4 pct).
Australia Q1 CPI (all groups) +5.1 pct YoY (Reuters poll +4.6 pct).

On the hourly chart, AUD/USD had been forming a bullish reverse head & shoulders ahead of the data as follows:

This is a reversal pattern and the neckline of the prior M-formation near 0.7180 could be targetted for the day ahead. The outcome has triggered a bid, so this validates the chart pattern, as follows:

About CPI

The Consumer Price Index released by the RBA and republished by the Australian Bureau of Statistics is a measure of price movements by the comparison between the retail prices of a representative shopping basket of goods and services . The purchase power of AUD is dragged down by inflation. The CPI is a key indicator to measure inflation and changes in purchasing trends. A high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or Bearish).

Author

FXStreet Team

FXStreet

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

USD/JPY eyes August swing low, near 155.20 ahead of US NFP

USD/JPY retests the August monthly swing low during the Asian session on Friday as a more hawkish repricing of BoJ rate-hike bets and a suspected intervention continue to underpin the Japanese Yen. Meanwhile, the US Dollar is seen consolidating the previous day's heavy losses amid soft US bond yields, further weighing on the currency pair as traders keenly await the US NFP report.

AUD/USD consolidates above 0.7200; US NFP awaited

AUD/USD holds steady above 0.7200, near its highest level since mid-May, as bulls await the US NFP report for more cues on the Fed's policy path before placing fresh bets. Meanwhile, the recent decline in US bond yields keeps the US Dollar depressed near its lowest level in over a week and acts as a tailwind for the Aussie amid the RBA's hawkish tilt.

Gold tumbles as blockbuster US NFP lift US Dollar, Treasury yields

Gold (XAU/USD) falls sharply on Friday, snapping a two-day recovery after the US Nonfarm Payrolls (NFP) report surprised strongly to the upside. The metal briefly climbed above $4,500 on Thursday, gaining nearly 2%, but has since erased a large part of that advance.

Crypto’s $638 million buyback boom may not be as bullish as it looks

Decentralized Finance (DeFi) protocols reportedly spent $638 million to buy back their native tokens in August, up 17% from a year earlier. On the surface, the buyback trend suggests the cryptocurrency industry is maturing fast, adopting one of Wall Street’s oldest tools to bolster valuations and distribute revenue. The headline becomes less impressive once the number is opened up.

Why hawkish Bank of Japan expectations aren't enough to sustain the Japanese Yen rally

The Japanese Yen (JPY) experienced a sudden burst higher after falling back below the 160.00 psychological mark against the US Dollar (USD) earlier this week amid a more hawkish repricing of Bank of Japan (BoJ) rate hike expectations.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.