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Australian dollar sits tight ahead of key data

ByFIBO Group
Published 01/27/2015, 04:03 AM
Updated 03/09/2019, 08:30 AM

The Australian dollar is sitting tight today gearing up for a round of important news due out this week.

At 6.28pm (AEDT) the Aussie dollar was trading at US79.22¢ virtually unchanged from yesterday.

The first round of news to hit the market is the durable goods number today from the US where analysts expect a number of 0,5% in stark contrast to last month's reading of -0.9% which may see the Australian currency drop back below the US79.00¢ mark.

The highlight of the week will be the latest CPI numbers from Australia where the consensus is for a number of 1.8% well down on last month's 2.3% and under the RBA's inflation target of between 2-3%.

"The news may be make or break for the RBA concerning interest rates" noted analysts at Fibogroup forex brokers.

"If the number comes in under expectations and especially by a big margin we could see the Central Bank move on rates as early as February to lift inflation back towards the target rate.

The falling CPI numbers have come about on the back of lower oil and food prices as well as sluggish wage growth. Most analysts agree that a weak inflation number is needed this time round in order to spur the RBA into action to move on rates.

Later on Wednesday the US Federal reserve will release their latest interest rate decision as well as the following monetary policy statement where the focus will be on the timing of an interest rate rise.

Even though Inflation in the US is under the Fed's target, a number of other indicators are moving ahead like the unemployment rate and consumer spending.

This should be enough to keep the Central bank on course to lift interest rates at sometime in the nearest future with some noting that April may be a possibility.

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