AUDUSD
In a few hours from now, Australia’s Consumer Price Index (CPI) would be made public. The consensus numbers are for the headline number to register at 0.9%, and for the trimmed-mean CPI to come in at 0.5%.
Analysts at Westpac point to the previous quarter’s reading of 0.9%, which beat Westpac’s consensus of 0.7%, as a sign that inflationary pressures are starting to creep in. The group forecasts the CPI to come in at 1.0%, and the annual rate to come in at 1.5%. Westpac expects the unwinding of the stimulus programs to boost the CPI going forward.
A rise in the CPI and its trimmed mean is considered AUD-positive, as it makes a case for a quicker return to a tighter monetary policy. Any form of an increase in both data sets above the consensus could help the AUD/USD higher. This could allow for a retest of the 0.7800 resistance. A break above this level allows the bulls to aim for 0.78911, with 2021’s high at 0.80072 standing firm above this level as another barrier.
On the other hand, figures that fall below consensus could allow for a correction towards 0.76555. Below this level, 0.75859 and 0.75141 present themselves as potential downside targets.
