When is the Australian CPI release, and how could it affect the AUD/USD?

Aussie CPI overview

Australia’s latest quarterly Consumer Price Index (CPI) figures will be dropping at 01:30 GMT early Wednesday, a key inflation figure that Aussie bulls have been waiting for as the AUD/USD major pair continues to consolidate between recent highs and lows. The q/q CPI reading for 2018’s Q2 is expected to improve from 0.4% to 0.5%, while the Reserve Bank of Australia’s (RBA) Trimmed Mean CPI for Q2 is expected to remain steady at 0.5%. Quarterly inflation within Australia’s economy has remained stubbornly sluggish, remaining trapped below 1.0% since the first quarter of 2014. Improving inflation continues to be a vexing problem for the RBA, and Aussie bulls continue to remain on the sidelines as Australia’s central bank remains in wait-and-see mode, hoping for inflation to begin picking up with expectations of a future rate hike from the RBA being pushed out into 2019.

How could it affect the AUD/USD?

For the AUD/USD, a missed reading below the forecast 0.5% will see traders short-changing the Aussie, driving the major pair down and giving bears a chance to take out the 0.7300 major level, while a better-than-expected reading will see AUD bulls return to the fold, driving the pair further beyond 0.7400 in an attempt to climb over current resistance from 0.7450. The AUD/USD fell below the 0.75 major handle in June, and buyers have struggled to develop a meaningful bullish correction.

Key notes

AUD/USD resting just above 0.74 as Aussie CPI rounds the corner

AUD/USD analysis: above 0.7400 ahead of key Australian inflation data

About the Aussie CPI

The Consumer Price Index released by the RBA and republished by the Australian Bureau of Statistics is a measure of price movements by the comparison between the retail prices of a representative shopping basket of goods and services . The purchase power of AUD is dragged down by inflation. The CPI is a key indicator to measure inflation and changes in purchasing trends. A high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or Bearish).