Australian Dollar Higher As RBA Rate Hike Bets Grow After Strong Inflation Data
April 26 2022 - 11:03PM
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The Australian dollar advanced against its major counterparts in
the Asian session on Wednesday, as a surge in the nation's consumer
inflation for the first quarter raised expectations for a rate hike
by the Reserve Bank of Australia at its meeting due next week.
Data from the Australian Bureau of Statistics showed that
Australia's consumer prices climbed 5.1 percent on year in the
first quarter of 2022 - beating forecasts for an increase of 4.6
percent and accelerating from 3.5 percent in the previous three
months.
On a quarterly basis, inflation jumped 2.1 percent - again
exceeding expectations for a gain of 1.7 percent and up from 1.3
percent in the three months prior.
The Reserve Bank of Australia's trimmed mean came in at 1.4
percent on quarter and 3.7 percent on year, up from 1.0 percent on
quarter and 2.6 percent on year in the previous quarter.
The RBA's weighted median was up 1.0 percent on quarter and 3.2
percent on year after rising 0.9 percent on quarter and 2.7 percent
on year three months earlier. The stunning beat firms up the
chances that the RBA will raise interest rates at its monthly board
meeting next week for the first time since 2010.
The strong data intensified hopes that the RBA will raise
interest rates by 15 basis points to 0.25 percent at its next
meeting on May 3.
The aussie climbed to 0.7191 against the greenback and 91.76
against the yen, off its early session's low of 0.7118 and a 5-week
low of 90.43, respectively. The aussie is seen finding resistance
around 0.74 against the greenback and 93.00 against the yen.
The aussie edged up to 1.4813 against the euro and 0.9188
against the loonie, rising from its prior low of 1.4942 and a 2-day
low of 0.9127, respectively. The next possible resistance for the
aussie is seen around 1.45 against the euro and 0.93 against the
loonie.
The aussie touched a 2-day high of 1.0917 against kiwi, from a
low of 1.0844 seen earlier in the session. On the upside, 1.11 is
possibly seen as its next resistance level.
Looking ahead, U.S. wholesale inventories, advance goods trade
balance and pending home sales, all for March, are scheduled for
release in the New York session.
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