The Australian Dollar (AUD) rises against the US Dollar (USD) on Wednesday, continuing its winning streak for the fourth successive session. The AUD/USD pair rises despite the easing November’s inflation in Australia. Traders now await the full fourth-quarter inflation report, due later this month. Analysts warned that a 0.9% or higher rise in core inflation could prompt the Reserve Bank of Australia (RBA) to tighten at its February meeting.
The Australian Financial Review (AFR) suggested that the RBA may not be done tightening this cycle. The poll indicates that inflation is expected to remain stubbornly elevated over the coming year, fueling expectations of at least two additional rate hikes.
The Australian Bureau of Statistics (ABS) reported on Wednesday that Australia’s Consumer Price Index rose 3.4% year-over-year (YoY) in November, easing from 3.8% in October. The reading missed market expectations of 3.7% but remained above the RBA’s 2–3% target. It marked the lowest inflation since August, with housing costs increasing at the slowest pace in three months.
Australia’s CPI was unchanged at 0% month-on-month (MoM) in November, matching October’s reading. Meanwhile, the RBA’s Trimmed Mean CPI rose 0.3% MoM and 3.2% YoY. Separately, seasonally adjusted Building Permits surged 15.2% MoM to a near four-year high of 18,406 units in November 2025, rebounding from a downwardly revised 6.1% fall previously. Annual approvals jumped 20.2%, reversing a revised 1.1% decline in October.
US Dollar declines ahead of ISM Services PMI
- The US Dollar Index (DXY), which measures the value of the US Dollar against six major currencies, is edging lower after registering modest gains in the previous session and hovering around 98.50 at the time of writing.
- Traders await US economic data that could shape expectations for Federal Reserve (Fed) policy. ISM Services Purchasing Managers’ Index (PMI) and JOLTs job openings will be eyed later in the day. The US Nonfarm Payrolls (NFP) report due Friday is expected to show job gains of 55,000 in December, down from 64,000 in November.
- Fed Governor Stephen Miran said on Tuesday that the US central bank needs to cut interest rates aggressively this year to support economic momentum. Meanwhile, Minneapolis Fed President Neel Kashkari warned of a risk that the unemployment rate could “pop” higher.
- Richmond Fed President Tom Barkin, a non-voter on the Fed’s rate-setting committee this year, said Tuesday that interest rate adjustments will need to be “finely tuned” to incoming data, citing risks to both the Fed’s employment and inflation objectives, according to Reuters.
- According to the CME Group’s FedWatch tool, Fed funds futures continue to price in about an 82.8% probability that the US central bank will keep rates unchanged at its January 27–28 meeting.
- The US launched a large-scale military strike against Venezuela on Saturday. US President Donald Trump said Venezuelan President Nicolas Maduro and his wife were captured and flown out of the country.
- Venezuelan President Maduro, on Monday, pleaded not guilty to US charges in a narco-terrorism case, setting the stage for an unprecedented legal battle with major geopolitical implications, according to Bloomberg.
- Traders expect two additional Federal Reserve rate cuts in 2026. Markets are bracing for US President Donald Trump to nominate a new Fed chair to replace Jerome Powell when his term ends in May, a move that could tilt monetary policy toward lower interest rates.
- China’s RatingDog Services Purchasing Managers’ Index (PMI), released on Monday, declined to 52.0 in December from 52.1 in November. RatingDog reported last week that Manufacturing PMI climbed to 50.1 in December from 49.9 in November. It is important to note that any change in the Chinese economy could impact the AUD as China and Australia are close trading partners.
- The RBA December Meeting Minutes indicated that policymakers stand ready to tighten policy if inflation fails to ease as expected, placing increased focus on the Q4 CPI report due January 28. Analysts note that a stronger-than-expected Q4 core inflation reading could trigger a rate hike at the RBA’s February 3 meeting.
Australian Dollar records fresh 14-month highs above 0.6750
AUD/USD is trading around 0.6750 on Wednesday. The technical analysis of the daily chart indicates that the pair moves upwards within the ascending channel pattern, suggesting a persistent bullish bias. However, the 14-day Relative Strength Index (RSI) at 70 suggests overbought conditions.
The AUD/USD pair has reached fresh highs since October 2024 and targets the upper boundary of the ascending channel near 0.6830.
The initial support lies at the nine-day Exponential Moving Average (EMA) of 0.6708, followed by the lower ascending channel boundary around 0.6700. A break below the confluence support zone could expose the AUD/USD pair to the area around the 50-day EMA at 0.6625.
Australian Dollar Price Today
The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.11% | -0.13% | -0.06% | 0.04% | -0.29% | -0.07% | -0.11% | |
| EUR | 0.11% | -0.02% | 0.05% | 0.15% | -0.18% | 0.04% | -0.01% | |
| GBP | 0.13% | 0.02% | 0.06% | 0.17% | -0.16% | 0.06% | 0.02% | |
| JPY | 0.06% | -0.05% | -0.06% | 0.11% | -0.22% | -0.01% | -0.05% | |
| CAD | -0.04% | -0.15% | -0.17% | -0.11% | -0.33% | -0.11% | -0.15% | |
| AUD | 0.29% | 0.18% | 0.16% | 0.22% | 0.33% | 0.22% | 0.18% | |
| NZD | 0.07% | -0.04% | -0.06% | 0.01% | 0.11% | -0.22% | -0.04% | |
| CHF | 0.11% | 0.00% | -0.02% | 0.05% | 0.15% | -0.18% | 0.04% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
Economic Indicator
Consumer Price Index (YoY)
The Consumer Price Index (CPI), released by the Australian Bureau of Statistics on a monthly basis, measures the changes in the price of a comprehensive basket of goods and services acquired by household consumers. The indicator is the primary measure of headline inflation after a new methodology was applied to transition from quarterly to monthly readings, applying to data from April 2024 onwards. The YoY reading compares prices in the reference month to the same month a year earlier. A high reading is seen as bullish for the Australian Dollar (AUD), while a low reading is seen as bearish.
Read more.
Read the full article here