AUD: Australia inflation finally cools, but where now?
There seems to be less pressure on the Reserve Bank of Australia (RBA) after the release of the central bank's quarterly inflation data.
Trimmed mean CPI, the RBA's favoured reading, decelerated to 0.9% in the second quarter year-on-year, from 1.2% the previous quarter. Economists were anticipating a rise of 1.1%. Rate futures are now pricing in a 25% chance of a quarter-point hike at the bank's next meeting, compared with 50% before the data release. The Aussie is down across a whole range of other currencies.
(Video Transcript)
The Reserve Bank of Australia
There seems to be less pressure on the Reserve Bank of Australia (RBA) to raise interest rates after the most recent inflation report came through today. The trimmed mean CPI. Now that the RBA's favoured rating has decelerated to 0.9% in Q2 year on year from a 1.2% reading in the previous quarter, Economists were anticipating a 1.1% rise, and rate futures are now pricing in a 25% chance of a quarter-point rate hike at the bank's next meeting.
Australian dollar
Now that's compared with the 50% expectation before the release of this data. I want to show you just one chart here, and that is the move on the AUD. We have been relatively low today. It bounced off the 200-day moving average at one point. But the broad sweep is that the Australian dollar is weaker in the wake of this slower-than-expected rise in inflation.
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