Aussie dips as US inflation higher than expected – heochaua

<p><a href="https://api.addthis.com/oexchange/0.8/forward/facebook/offer?url=https%3A%2F%2Fwww.marketpulse.com%2Fnews-events%2Fcentral-banks%2Faussie-dips-as-us-inflation-higher-than-expected%2Fkfisher&amp;pubid=ra-525512e4690e068c&amp;title=Marketpulse%20%7C%20Home&amp;ct=1" target="_blank"><img src="https://cache.addthiscdn.com/icons/v3/thumbs/32×32/facebook.png" border="0" alt="Facebook" /></a><a href="https://api.addthis.com/oexchange/0.8/forward/twitter/offer?url=https%3A%2F%2Fwww.marketpulse.com%2Fnews-events%2Fcentral-banks%2Faussie-dips-as-us-inflation-higher-than-expected%2Fkfisher&amp;pubid=ra-525512e4690e068c&amp;title=Marketpulse%20%7C%20Home&amp;ct=1" target="_blank"><img src="https://cache.addthiscdn.com/icons/v3/thumbs/32×32/twitter.png" border="0" alt="Twitter" /></a><a href="https://api.addthis.com/oexchange/0.8/forward/email/offer?url=https%3A%2F%2Fwww.marketpulse.com%2Fnews-events%2Fcentral-banks%2Faussie-dips-as-us-inflation-higher-than-expected%2Fkfisher&amp;pubid=ra-525512e4690e068c&amp;title=Marketpulse%20%7C%20Home&amp;ct=1" target="_blank"><img src="https://cache.addthiscdn.com/icons/v3/thumbs/32×32/email.png" border="0" alt="Email" /></a></p><p>The Australian dollar has posted sharp losses on Thursday. In the North American session, AUD/USD is trading at 0.6655, down 0.68%.</p>
<p><strong>US inflation report sends greenback higher</strong></p>
<p>US inflation was higher than expected in December with a gain of 3.4%. This followed the 3.1% gain in November and was higher than the market estimate of 3.2%. The upswing was driven by energy and food prices, which fell at a slower pace in December than in November. On a monthly basis, CPI rose to 0.3%, up from 0.1% in November and above the market estimate of 0.2%.</p>
<p>Core CPI, which is considered a more reliable gauge of inflation trends, dipped to 3.9% in December. This was lower than the 4.0% gain in November and the market estimate of 3.9%. Core CPI was unchanged at 0.3% and matched the market estimate.</p>
<p>The rise in inflation has boosted the US dollar against the major currencies, as speculation has risen that the Fed might delay plans to lower interest rates. The Fed hasn&#8217;t provided a timeline for an initial rate cut, a source of frustration for investors. The markets have been forced to lower the odds of a March cut to around 70% due to today&#8217;s inflation report and last week&#8217;s nonfarm payrolls release, which was also stronger than expected.</p>
<p>The strong inflation report shows that the battle to reduce inflation to the 2% target will be tough, as the last mile could prove to be the most difficult. Housing and services prices have remained high despite the Fed&#8217;s rate hikes. Still, inflation remains relatively low and with the labour market showing resilience despite high rates, there is a strong chance that the Fed will be able to guide the economy to a soft landing.</p>
<p>.</p>
<p><strong>AUD/USD Technical</strong></p>
<ul>
<li>There is resistance at 0.6732 and 0.6824</li>
<li>0.6625 and 0.6533 are providing support</li>
</ul>
<p><a href="https://www.marketpulse.com/wp-content/uploads/2024/01/AUDUSD_2024-01-11_19-27-52.png"><img loading="lazy" class="alignnone wp-image-809387" src="https://www.marketpulse.com/wp-content/uploads/2024/01/AUDUSD_2024-01-11_19-27-52-300×146.png" alt="" width="400" height="194" srcset="https://www.marketpulse.com/wp-content/uploads/2024/01/AUDUSD_2024-01-11_19-27-52-300×146.png 300w, https://www.marketpulse.com/wp-content/uploads/2024/01/AUDUSD_2024-01-11_19-27-52-1024×497.png 1024w, https://www.marketpulse.com/wp-content/uploads/2024/01/AUDUSD_2024-01-11_19-27-52-768×373.png 768w, https://www.marketpulse.com/wp-content/uploads/2024/01/AUDUSD_2024-01-11_19-27-52-1536×746.png 1536w, https://www.marketpulse.com/wp-content/uploads/2024/01/AUDUSD_2024-01-11_19-27-52.png 1835w" sizes="(max-width: 400px) 100vw, 400px" /></a></p>