Australia’s headline Consumer Price Index rose 0.8 percent in September, the Australian Bureau of Statistics reported, and the annual rate accelerated to 4.3 percent from 4.0 percent in August. Forecasts had pointed to 4.2 percent on the annual measure and 0.7 percent month on month. The figures landed ahead of the Asian session.
The Australian dollar responded quickly. AUD/USD climbed to a level near 0.7050-0.7055, its highest since September 23. By our market data, as of 01:35 GMT, the pair was at $0.7043, its highest in 31 days.
Rate-hike bets build
The hotter-than-expected print lifted bets on a Reserve Bank of Australia rate hike at its November meeting.
Traders are weighing that domestic pressure against a dollar that has its own reasons to firm. The US dollar rose to a two-week high on expectations that the Federal Reserve will raise borrowing costs again by year-end.
Technical levels in focus
On the charts, the Australian dollar has support at 0.7033, the 100-day simple moving average. Resistance sits at 0.7066, the 50 percent Fibonacci retracement, with the 61.8 percent retracement at 0.7106 above that.
Attention now turns to the Federal Open Market Committee decision, due later in the US session. The Fed was widely expected to hold rates steady at its two-day meeting.
Source: Australian Bureau of Statistics | Data: Swissquote
