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AUD/USD struggles to pick a direction as Aussie CPI comes out mixed

4/24/2018, 10:16:47 AMMarket Analysis
AUD/USD struggles to pick a direction as Aussie CPI comes out mixed

The AUD/USD is trading in place as mixed figures for the Australian CPI fail to boost any confidence, but have avoided extending the slide and the pair is trading back into the 0.7600 handle after sliding steadily in the CPI run-up.

The Aussie has fallen against the Greenback for three consecutive trading days and is on pace to do so for a fourth as the US Dollar rallies against the broader market and the Aussie fumbles amidst souring economic data and a dovish Reserve Bank of Australia (RBA) that looks set to hold still on rates well into 2019. The Australian economy continues to lag behind global growth trends, and key figures continue to miss expectations more often than not.

Aussie CPI results

The Australian CPI figures came out mixed, which means the RBA continues to be unlikely to raise rates anytime soon as inflation remains far below the central bank's 2 percent minimum target. The AUD came into Tuesday trading on the low side, sinking further during the overnight session after losing ground steadily through Monday's action. With the widening interest rate differential beginning to eat away at the Aussie, and the ongoing US-China trade tensions continuing to sap confidence in the Asian theater, the AUD is on pace to continue sliding against the wider currency bloc as economic indicators continue to wallow.

AUD/USD Levels to watch

The Aussie started Tuesday off on a low note, ending Monday's trading near the 0.7600 major handle, and the sell-off has continued into Asia, with the AUD/USD sliding into 0.7585 following the Aussie CPI, which mixed on expectations, and while it failed to impress, hasn't been met with immediate sell-off. The immediate boundaries for action will be Monday's high of 0.7680, and ultimately the last swing high beyond that at the 0.7800 major level, while downside action will have to contend with support from December's lows near 0.7500.