(April 27 Wednesday) The australian dollar fell sharply from 0.7753 to 0.7630 (-123 pips) in the prior Asian session after Australia's inflation data ame out much weaker than expected. The Trimmed mean CPI rose +0.2% Q/Q versus the median forecast of +0.5%. The Weighted median CPI was +0.1% Q/Q versus the median forecast of +0.5%. The 1st quarter all group CPI fell -0.2% Q/Q versus the median forecast of +0.3%. The 1st quarter all groups CPI +1.3% Y/Y versus the median forecast of +1.8%.
The CPI data is below the RBA's target for the second time in 15 years and thus raised speculation of further interest rate cuts by the RBA. Pressure mounts on RBA Governor Stevens to resume easing policy. The aussie dollar fell against the major currencies. AUDUSD fell on extended selling in Europe to the low of 0.7600.
The low from April 18 at 0.7592 is a fragile support. The next support levels are 0.7573 Apr 12 low and 0.7528 Apr 11 low.