The Australian dollar moved lower against its major trading partners in the Asian session on Wednesday, as the country’s inflation rose less than expected in the first quarter, cementing expectations that the Reserve Bank of Australia will keep interest rate at record lows for the forseeable future.
Data from the Australian Bureau of Statistics showed that Australia’s consumer prices rose 0.6 percent on quarter in the first quarter of 2021.
That was shy of expectations for 0.9 percent, which would have been unchanged from the three months prior.
On a yearly basis, inflation gained 1.1 percent – also missing forecasts for 1.4 percent but still up from 0.9 percent in the previous three months.
Asian stock markets are trading mixed following mixed cues overnight from Wall Street, as traders refrained from making major moves ahead of the Federal Reserve’s latest monetary policy decision later today.
The aussie dropped to a 5-day low of 0.7725 against the greenback from Tuesday’s close of 0.7762. The aussie is seen finding support around the 0.75 mark.
The aussie pulled back to 84.14 against the yen, from a high of 84.52 hit at 7:30 pm ET. The aussie is likely to challenge support around the 80.00 region, if it drops again.
Data from the Ministry of Economy, Trade and Industry showed that Japan retail sales climbed 5.2 percent on year in March – coming in at 13.498 trillion yen.
That beat expectations for an increase of 4.7 percent following the 1.5 percent decline in the previous month.
The aussie touched 1.5634 against the euro, its lowest level since April 14. Next key support for the aussie is seen around the 1.60 level.
The aussie that closed yesterday’s deals at 0.9624 against the loonie declined to a 2-week low of 0.9591. Should the aussie falls further, it is likely to face support around the 0.94 region.
The aussie slipped to its weakest level since March 11 against the kiwi, at 1.0735. The aussie is poised to challenge support around the 1.06 mark.
Looking ahead, Swiss economic sentiment index for April is set for release in the European session.
Canada retail sales for February and U.S. wholesale inventories and advance goods trade balance for March will be published in the New York session.
At 2:00 pm ET, the Fed announces its decision on interest rate. Economists widely expect the federal funds rate to be kept at 0 – 0.25 percent.
The material has been provided by InstaForex Company – www.instaforex.com