The Australian dollar was under pressure.
According to the published data, the growth of consumer price indices showed worse than forecasts. In the annual terms, growth slowed down from 1.9% to 1.8%. On a quarterly basis, growth was 0.6%, with a 0.8% increase in the forecast for the previous value of 0.2% for the second quarter.
The data clearly indicate a slowdown in inflationary pressures within the economy of the so-called "green continent". This would likely weaken expectations for a change in the monetary policy in favor of tightening, accompanied by an increase in interest rates. With this, it can be assumed that the Australian currency will continue to decline in the recent years.
The UK GDP is expected to be published today, with expectations for a decline in the annual terms for the third quarter to 1.4% vs. 1.5%. In the quarterly terms, the previous growth rate of 0.3% is predicted. If the data does not exceed expectations, this may lead to the continued sterling.
The main event on Wednesday will also be the outcome of the CBA meeting on monetary policy. It is forecasted that the main interest rate will remain at the level of 1.0%. In our opinion, if the interest remains at the same level, most likely, the resolution of the bank will not show the desire to raise rates in the near future, and besides, the commentary of the bank's manager Poloz during the press conference will be "dovish" by content, the Canadian currency will be under pressure.In general, considering the situation in the currency markets, we note that the US dollar continues to be in demand and its counterpart currencies would likely decline.
Forecast of the day:
The AUD / USD fell on the wave of weak data on the Australian consumer inflation. It is assumed that failure to recover above 0.7740, then we should expect the continuation of its fall after a likely slight rollback up to 0.7740 down to 0.7660 on the wave of the general strengthening of the US dollar positions.
The USD/CAD remains in the short-term uptrend against the background of a general strengthening of the dollar, accompanied by low expectations that the CBA will raise rates again before the end of this year. On this wave, after a slight correction to the level of 1.2640, the pair may continue to grow to 1.2765. From a technical point of view, it's important to keep the support level at 1.2640.
