AUD/USD Edges Closer to Key Resistance Amid US Inflation Fears

The AUD/USD currency pair has been inching towards the resistance zone of 0.7215-0.7277, which is a crucial level for bulls to break through. The pair has gained around 0.1% since Monday and is eyeing the 50-month high of 0.72825.

However, the next couple of days are pivotal for market movements as the US inflation data comes out. The August update on Producer Price Index (PPI) is due on Wednesday followed by the Consumer Price Index (CPI) on Thursday.

The market is closely watching these numbers as a strong reading could lead to interest rate hikes, which would positively impact the AUD/USD pair. On the other hand, a weak reading could bring down the US dollar and push the pair lower.