When are the Australian CPIs and how could they affect the AUD/USD?

Australian CPI overview

Very early on Wednesday at 00:30 GMT will see 2018's fourth quarter inflation data dump for the Australian economy, and the headline q/q CPI reading is expected to come in at 0.4%, unchanged from the previous quarter's reading.

The Reserve Bank of Australia's (RBA) trimmed-mean CPI is also expected to arrive at 0.4%, steady from the previous period's 0.4%, while the annualized CPI is expected to show 1.7%, a soft decline from the previous 1.9%.

How could it affect the AUD/USD?

According to FXStreet's own Valeria Bednarik, “the 4 hours chart shows that the pair is hovering around directionless and converging moving averages which clearly reflect the lack of directional strength. The Momentum indicator in the mentioned chart heads south around its mid-line, while the RSI hovers around 50, also failing to provide directional clues. The inflation report may fall short of affecting RBA's upcoming decision, but will probably provide some short-term action, with a break below the mentioned 0.7125 support on bad news opening doors for a steeper slide down to 0.7030.

Support levels:  0.7125 0.7085 0.7030

Resistance levels: 0.7175 0.7200 0.7235.”

Key Notes

Australian CPI Preview: Banks expecting headline CPI to print in between 0.3-0.4% for Dec quarter

Iron Ore surge not enough to break AUD’S range bound stupor

NAB Australian business conditions worsen in December, arrive at 2 vs. 11 last    

About the Australian CPI

The Consumer Price Index released by the RBA and republished by the Australian Bureau of Statistics is a measure of price movements by the comparison between the retail prices of a representative shopping basket of goods and services . The purchase power of AUD is dragged down by inflation. The CPI is a key indicator to measure inflation and changes in purchasing trends. A high reading is seen as positive (or bullish) for the AUD, while a low reading is seen as negative (or Bearish).