Australian Dollar Falls As Soft Inflation Fuels RBA Rate Pause Hopes
(RTTNews) - The Australian dollar depreciated against its most major counterparts on Wednesday, as the nation's consumer inflation slowed more than expected in February, bolstering hopes for a pause in the policy tightening by the Reserve Bank of Australia.
Data from the Australian Bureau of Statistics showed that the CPI advanced 6.8 percent year-on-year in February, slower than the 7.4 percent increase in January.
Economists had expected a 7.2 percent rise.
CPI excluding fruit, vegetables and fuel rose 6.9 percent, down from 7.5 percent in January.
Soft inflation reading raised hopes that the RBA will pause its tightening cycle next week.
The aussie edged down to 0.9077 against the loonie and 0.6667 against the greenback, from an early high of 0.9123 and a 6-day high of 0.6713, respectively. The aussie is seen finding support around 0.88 against the loonie and 0.64 against the greenback.
Reversing from its early highs of 1.0730 against the kiwi and 1.6151 against the euro, the aussie fell to a 5-day low of 1.0685 and a 2-day low of 1.1317, respectively. The currency may find support around 1.045 against the kiwi and 1.65 against the euro.
In contrast, the aussie was up against the yen, at a 6-day high of 88.30. Immediate resistance for the currency is seen around the 92.00 level.
Looking ahead, U.S. pending home sales for February are set for release in the New York session.
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