AUD/USD Shorts Bear the Brunt of Hot CPI and Renewed RBA Hike Bets
Australia's July inflation report revealed strong gains in trimmed mean CPI and annual underlying inflation, reigniting RBA hike expectations and putting pressure on AUD/USD short positions.
The Australian Bureau of Statistics reported a monthly increase of 0.5% in trimmed mean CPI, its strongest since May, with the annual rate holding steady at 3.6%. The data also showed broad gains across various sectors, including transport, clothing and footwear, and furnishings and household services.
The results come on the heels of yesterday's RBA minutes, which revealed that some members considered raising the cash rate in August. While a single report does not guarantee another hike, these figures likely increase the odds of a live meeting in September compared to 24 hours ago.
AUD/USD shorts are facing fresh pressure after hot CPI, with renewed RBA hike risk adding further support for an already strong Australian dollar. The currency is considering a break above the August 21 high, and a retest and potential break above 72c remains a possibility.