Investing.com – The Australian dollar tumbled to a 1-week low against its U.S. counterpart on Wednesday, following the release of weak domestic data on inflation and as the greenback staged a broad rally.
AUD/USD hit 0.9683 during European morning trade, the pair’s lowest since October 20; the pair subsequently consolidated at 0.9723, plunging 1.34%.
The pair was likely to find short-term support at 0.9662, the low of October 20 and resistance at 0.9926, Tuesday’s high.
Earlier in the day, official data showed that Australian consumer price inflation rose less-than-expected in the third quarter. In a report, the Australian Bureau of Statistics said that CPI rose at a seasonally adjusted rate of 0.7% in the third quarter after rising 0.6% in the preceding quarter. Analysts had expected CPI to rise 0.8% in the third quarter.
The report said that CPI rose at an annual rate of 2.8% in the third quarter, compared to a 3.1% rise in the quarter ending in June. Core inflation rose 0.6% from the previous quarter and 2.5% from a year earlier.
The weak data dampened expectations of an interest rate hike by the Reserve Bank of Australia following next weeks policy meeting.
The Aussie was also down against the euro, with EUR/AUD soaring 1.12% to hit 1.4224.
Last Tuesday, the Wall Street Journal reported that the Federal Reserve was likely to unveil a program of U.S. Treasury bond purchases worth a few hundred billion dollars over several months, contrary to market expectations of purchases in excess of USD 1 trillion.
AUD/USD hit 0.9683 during European morning trade, the pair’s lowest since October 20; the pair subsequently consolidated at 0.9723, plunging 1.34%.
The pair was likely to find short-term support at 0.9662, the low of October 20 and resistance at 0.9926, Tuesday’s high.
Earlier in the day, official data showed that Australian consumer price inflation rose less-than-expected in the third quarter. In a report, the Australian Bureau of Statistics said that CPI rose at a seasonally adjusted rate of 0.7% in the third quarter after rising 0.6% in the preceding quarter. Analysts had expected CPI to rise 0.8% in the third quarter.
The report said that CPI rose at an annual rate of 2.8% in the third quarter, compared to a 3.1% rise in the quarter ending in June. Core inflation rose 0.6% from the previous quarter and 2.5% from a year earlier.
The weak data dampened expectations of an interest rate hike by the Reserve Bank of Australia following next weeks policy meeting.
The Aussie was also down against the euro, with EUR/AUD soaring 1.12% to hit 1.4224.
Last Tuesday, the Wall Street Journal reported that the Federal Reserve was likely to unveil a program of U.S. Treasury bond purchases worth a few hundred billion dollars over several months, contrary to market expectations of purchases in excess of USD 1 trillion.