Australian Dollar Rises After Strong Australia CPI Data
August 27 2024 - 10:21PM
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The Australian dollar strengthened against other major
currencies in the Asian session on Wednesday, after data showed
that Australia's monthly consumer price index rose more than
expected in July.
Data from the Australian Bureau of Statistics or ABS showed that
the Australia's monthly Consumer Price Index or CPI rose 3.5
percent in the year to July, compared to a 3.8 percent increase
seen in June. Economists expected the consumer price index to
increase 3.4 percent in July.
The inflation data spurred speculation among the traders for
further interest-rate hikes from the Reserve Bank of Australia
(RBA), also fueled the strength of Australian dollar.
Traders remain cautious and await the release of key U.S.
inflation report later in the week, which could impact expectations
for how quickly the U.S. Fed will cuts interest rates.
In other economic news, data from the Australian Bureau of
Statistics showed that the value of total construction work done in
Australia was up a seasonally adjusted0.1 percent on quarter in the
second quarter of 2024, standing at A$64.932 billion. That missed
expectations for a gain of 0.8 percent following the 2.9 percent
contraction in the three months prior.
On a yearly basis, overall construction work rose 1.5
percent.
In the Asian trading today, the Australian dollar rose to more
than a 1-month high of 1.6408 against the euro, from yesterday's
closing value of 1.6464. The aussie may test resistance around the
1.59 region.
Against the U.S. and the Canadian dollars, the aussie advanced
to nearly an 8-month high of 0.6813 and a 2-day high of 0.9159 from
Tuesday's closing quotes of 0.6792 and 0.9128, respectively. If the
aussie extends its uptrend, it is likely to find resistance around
0.69 against the greenback and 0.93 against the loonie.
Against the yen and the NZ dollar, the aussie edged up to 98.25
and 1.0911 from yesterday's closing quotes of 97.77 and 1.0860,
respectively. The next possible upside target of the aussie is
found around 104.00 against the yen and 1.11 against the kiwi.
Looking ahead, the European Central Bank is slated to release
monetary aggregates for July at 4:00 am ET in the European
session.
In the New York session, U.S. MBA weekly mortgage approvals data
and U.S. EIA weekly crude oil data are slated for release.
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