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AUD/USD – Steady on Mixed Australian Consumer Inflation Reports

AUD/USD continues to have a quiet week, as the pair trades in the mid-0.79 range on Wednesday. On the release front, Australian CPI slipped to 0.2%, but Trimmed Mean CPI improved to 0.7%. In the US, the Federal Reserve will issue its monthly policy statement. The other event on the schedule is Crude Oil Inventories, with the markets expecting a strong downturn in the upcoming report.

The Australian dollar shrugged off mixed CPI numbers for the fourth quarter. CPI, the primary gauge of consumer inflation, dropped to just 0.2% in Q4, shy of the forecast of 0.3%. This was the index’s weakest gain in two years. However, there was much better news from Trimmed Mean CPI, which posted a strong gain of 0.7%, beating the estimate of 0.5%. We’ll get a look at PPI on Friday, with the markets expecting a slight gain of 0.3%.

The Federal Reserve will be in the spotlight on Wednesday, with the release of a policy statement at the end of a two-day meeting. The Fed is expected to continue to counsel patience regarding an interest rate hike [1], and persistently weak inflation means the Fed can take its time before having to make a monetary move. The markets will be combing through the statement and any clues as to the timing of rate hike could shake up the currency markets.

There was mixed numbers out of the US on Tuesday. Durable Goods Orders plunged 3.4%, marking a 4-month low. There was no relief from Core Durable Goods Orders, which declined by 0.8%, its fifth drop in six readings. The markets had expected gains from both indicators. There was much better news later in the day, as CB Consumer Confidence jumped to 102.9 points, crushing the estimate of 95.3 points. New Home Sales followed suit, rising to 481 thousand, well above the forecast of 452 thousand.

AUD/USD for Wednesday, January 28, 2015

AUD/USD January 28 at 15:15 GMT

AUD/USD 0.7957 H: 0.8025 L: 0.7900

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.7684 0.7799 0.7904 0.8081 0.8150 0.8214

 

Further levels in both directions:

 

OANDA’s Open Positions Ratio

AUD/USD ratio is pointing to gains in short positions on Wednesday. This is not consistent with the movement of the pair, as the Aussie has posted small gains. The ratio has a majority of long positions, indicative of trader bias towards AUD/USD moving higher.

AUD/USD Fundamentals

*Key releases are highlighted in bold

*All release times are GMT

 

OANDA MarketPulse Nominated for FXstreet’s 2015 Forex Best Awards

We are pleased to share the news that FXstreet – Europe’s oldest forex trading portal, published online in more than 50 countries – has nominated your MarketPulse team for the “Best Sell-Side Analysis Team” award again this year (the winners in 2014!), as well as in the category of “Best Analysis”.

The annual Forex Best Awards highlight the best analysis, educational content, and contributors on its website from the preceding year. It is a tremendous honour to be considered for this industry accolade out of the thousands of top tier banks and financial blogs online.

However, in order to win these important awards, we need your help – we need you to vote for us [2].

[2]

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher [6]

Market Analyst at OANDA [7]
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including Investing.com, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

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