In response to the rapidly rising Australian inflation which hits an annual rate of 8.4% in December, the Reserve Bank of Australia has been increasing its interest rates since the second quarter of 2022.
The burden of rising energy, rent, and food prices has been particularly felt by consumers, although price pressures are expected to ease.
The Australian Dollar Index Chart.
The rate increase has been supportive to the Australian Dollar as seen in the chart. The index could possibly trend higher toward the resistance zone in the near term.
The looming inflation is gradually declining as the Consumer Price Index currently sits at 6.4% as at the time of wring this article.
On the economic outlook, the labor market sector remains solid as more than 65,000 jobs were added in the previous month, higher than economists forecast. The unemployment rate sits low at 3.5% and the Gross Domestic Product grew by 0.8% in the first quarter of 2023.
The positive is those core economic indicators could possibly drive the AUDUSD higher. Other currencies where trading opportunities lies include the AUD/JPY, AUDCAD, AUDCHF, AUDJPY, AUDNZD, etc.
Nevertheless, Traders should brace themselves up for a period of high volatility as an increase in Consumer Price Index will strengthen the Australian Dollar(AUD) while a decrease will weaken the Australian Dollar (AUD)
Time Schedule for the Australian Consumer Price(CPI) Index Release:
Date: Wednesday, April 26th, 2023.
Time: 2:30 am (GM + 1).
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