Pound Slumps to Two-Month Low vs Aussie Amid Inflation Surprise

The Pound-Australian Dollar exchange rate declined by around 0.4% on Wednesday, falling just short of a two-month low.

This downturn was largely driven by Australia's latest consumer price index (CPI) data, which showed inflation outpaced expectations in July at 3.5% year-on-year, beating forecasts it would fall as low as 3.3%.

The stronger-than-expected inflation reading raised bets that the Reserve Bank of Australia (RBA) may resume its tightening cycle sooner rather than later.

Meanwhile, the Pound trended broadly lower due to a 4% rise in the UK's energy price cap, which thrust cost-of-living concerns back into the spotlight.