The Australian dollar strengthened against other major currencies in the Asian session on Wednesday, as trader’s sentiment improved after the release of higher inflation data signaling the Reserve Bank of Australia delivering a final 25 basis point rate hike in November meeting.
Data from the Australian Bureau of Statistics showed that the consumer prices grew 1.2 percent sequentially, faster than the 0.8 percent increase in the second quarter. Economists had forecast an annual rate of 1.1 percent.
The most significant contributors to the sequential increase were automotive fuel, rents, new dwellings purchased by owner occupiers and electricity. Due to higher global oil prices, automotive fuel prices advanced 7.2 percent after two quarters of declines. Rents gained 2.2 percent with rental price growth for flats continuing to outpace price growth for houses.
In the Asian trading today, the Australian dollar rose to nearly a 1-1/2-month high of 1.0915 against the NZ dollar from yesterday’s closing value of 1.0871. If the aussie extends its uptrend, it is likely to find resistance around the 1.10 region.
Against the U.S. and the Canadian dollars, the aussie advanced to nearly a 2-week high of 0.6400 and nearly a 2-month high of 0.8789 from yesterday’s closing quotes of 0.6355 and 0.8730, respectively. The aussie may test resistance around 0.65 against the greenback and 0.88 against the loonie.
The aussie climbed to more than a 3-week high of 95.89 against the yen and a 1-week high of 1.6559 against the euro, from Tuesday’s closing quotes of 95.27 and 1.6658, respectively. On the upside, 97.00 against the yen and 1.64 against the euro are seen as the next resistance levels for the aussie.
Looking ahead, Germany Ifo business climate index and Switzerland economic sentiment index, both for October, are slated for release soon in the European session.
In the New York session, U.S. MBA mortgage approvals data, U.S. new home sales data for September and U.S. EIA crude oil data are set to be published.
At 10:00 am ET, Bank of Canada will announce its monetary policy decision. The economists expect the interest rate to remain steady at 5.00 percent.
After an hour, the Bank of Canada Governor Tiff Macklem and Senior Deputy Governor Carolyn Rogers will hold a press conference to discuss the contents of the Report.
The material has been provided by InstaForex Company – www.instaforex.com