Audusd rises 0.39% amid moderating inflation in US and Australia

AUDUSD Analysis

Performance after Thursday
Period	Pct	Chg	Momentum
Thursday	0.39%	26.1 Pips
Week to-date	-2.55%	-176.4 Pips
October	-2.51%	-173.4 Pips

Upcoming key events (London Time)

Fri 01:30 PM USD Producer Price Index (12-mth)

What happened lately

In the United States, the Consumer Price Index (CPI) saw a modest increase of 0.2% on a seasonally adjusted basis, maintaining the same growth rate as observed in the preceding months of August and July. This data was released by the U.S. Bureau of Labor Statistics. Over the past year, the all items index reflected a 2.4% rise, which is notable as it represents the smallest 12-month increase since February 2021. The steady albeit slight increase in CPI suggests that inflationary pressures are moderating, marking a shift towards stability in price levels.

In Australia, the survey released for October reveals that consumer inflationary expectations have fallen to 4%, down from 4.4% in September. This decline indicates that Australian consumers anticipate a decrease in inflation levels in the near future, which could positively influence consumer confidence and spending behaviors. The lowered expectations might signify an easing of pricing pressure as perceived by the populace, potentially impacting interest rate determinations by the Reserve Bank of Australia.

The fluctuations in data from both the United States and Australia have implications for the currency exchange pair AUD/USD. On the day of the report, AUD/USD increased by 0.39% to reach 0.67428. This rise can be attributed to a combination of factors, including the United States’ lower-than-expected inflation rate along with declining inflationary expectations in Australia. The subdued inflation in the U.S. reduces the urgency for aggressive monetary policy actions by the Federal Reserve, potentially aiding in retaining a broader appeal for riskier assets like the Australian dollar. Consequently, this scenario may strengthen the Aussie against the dollar, making AUD/USD a more favorable investment due to anticipated stability in fiscal policies on both sides. Upcoming economic events, particularly the U.S. Producer Price Index, will be pivotal in further influencing market sentiments concerning the AUD/USD pair.

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What can we expect from AUDUSD today?

AUDUSD on Thursday rose 0.39% to 0.67428. Price is below 9-Day EMA while Stochastic is falling in oversold zone.

Updated daily direction for AUDUSD looks bullish as the pair ended higher after Thursday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 0.67581 with break above could target R2 at 0.67734 or figure level area. While towards the downside, we are looking at daily low of 0.66993 as an important support. Break below this level could weaken the current bullish momentum. A break above 0.67440 may suggest continuation after recent positive movement.

For the week to-date, take note that AUDUSD is bearish as the pair posted lower by -2.55%.

Key levels to watch out:

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