CANBERA (dpa-AFX) - The Australian dollar strengthened against other major currencies in the Asian session on Wednesday, following the release of Australia's consumer price inflation accelerating more than expected to a one-year high in July.
Data from the Australian Bureau of Statistics showed that the CPI indicator advanced 2.8 percent year-on-year in July, following June's 1.9 percent rise, reported. This was the strongest since July 2024, when inflation was 3.5 percent and also remained above economists' forecast of 2.3 percent.
Data came a day after the minutes of the Reserve Bank of Australia's board meeting held in August suggested that some further reduction in the cash rate over the coming year is likely and the pace of the future policy easing would be determined by the incoming data.
At the August meeting, the policy board unanimously decided to trim the cash rate target by 25 basis points to 3.60 percent, which was the third reduction this year.
In other economic news, the Australian construction work done improved to 3 percent in the second quarter, up from the forecasted 0.8 percent.
The Asian shared traded mixed, as traders remain cautious and seem reluctant to make significant moves ahead of the release of key U.S. economic data later in the week, including second quarter GDP and the US Fed's preferred readings on consumer price inflation, which could impact the outlook for interest rates.
Trump has threatened to impose 'substantial additional tariffs' on countries that do not remove digital taxes and related regulations that harm U.S. tech companies. He also threatened to impose 200 percent tariffs on China if Beijing does not export rare-earth magnets to the U.S.
Further, in a letter posted on Truth Social on Monday, Trump said he is removing Fed Governor Lisa Cook from her position amid accusations she made false statements on one or more mortgage agreements.
However, Cook responded with a statement claiming Trump does not have the authority to fire her and said she will not resign. Cook said she will file a lawsuit challenging her removal, while the Fed said it will 'abide by any court decision.'
In the Asian trading today, the Australian dollar rose to a 2-day high of 0.6505 against the U.S. dollar and an 8-day high of 96.01 against the yen, from yesterday's closing quotes of 0.6496 and 95.79, respectively. If the aussie extends its uptrend, it is likely to find resistance around 0.66 against the greenback and 97.00 against the yen.
Against the euro and the NZ dollar, the aussie climbed to nearly a 2-week high of 1.7889 and nearly a 6-month high of 1.1109 from Tuesday's closing quotes of 1.7916 and 1.1090, respectively. The aussie may test resistance around 1.77 against the euro and 1.12 against the kiwi.
The aussie edged up to 0.8995 against the Canadian dollar, from yesterday's closing value of 0.8986. On the upside, 0.90 is seen as the next resistance level for the aussie.
Looking ahead, Canada wholesale sales data for July, U.S. MBA mortgage approvals data an U.S. EIA crude oil data are slated for release in the New York session.
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