FX.co ★ Aussie Dollar Rises After a Stronger CPI Print

The Australian dollar experienced an uptick, reaching approximately $0.650 on Wednesday, achieving a one-week high. This rise followed an unexpectedly robust inflation report that bolstered speculations of the Reserve Bank of Australia's (RBA) potential hawkish policy stance. The latest comprehensive monthly price data indicated persistent inflationary pressures, with the headline inflation rate accelerating to 3.8% in October—the fastest pace in seven months—surpassing initial projections. Notably, the trimmed mean inflation, preferred by the RBA as an indicator of core inflationary trends, increased to 3.3%, also exceeding expectations. A surprisingly strong quarterly inflation figure last month had already led the RBA to maintain the interest rates. Additionally, comments made by Assistant Governor Hunter last week pointed out that the labor market is slightly surpassing sustainable levels, characterized by falling unemployment and sustained wage growth, highlighting ongoing tightness and reinforcing the central bank's cautious approach. Current market pricing indicates minimal likelihood of rate easing before May of the following year, with some analysts suggesting that the easing cycle may have concluded already.