AUD/USD leaps above 0.76 on USD sell-off after CPI data
After spending the last few hours trading in a very narrow channel, the AUD/USD pair jumped nearly 50 pips after the consumer inflation figures from the U.S. missed the expectations and refreshed its highest level since early April at 0.7630. As of writing, the pair is trading at 0.7624, up 1.17% on the day.
The latest data from the U.S. revealed that the Consumer Price Index in May eased to -%0.1 in May from 0.2% in April and missed the market consensus of 0%. On a yearly basis, the CPI fell to 1.9% from 2.2%. The details of the report showed that a decrease in the energy index was the main contributor to the monthly decrease in the all items index. The gasoline index dropped 6.4% and the energy index eased 2.7%.Moreover, advance estimate for retail sales contracted 0.3% in May after expanding 0.4% in April.
- US: Advance estimates of retail and food services sales for May 2017 were $473.8 billion
- US: Consumer Price Index for all urban consumers decreased 0.1% in May
Following the data, the US Dollar Index sharply fell below the 97 handle and touched its lowest level since Donald Trump's election victory in November at 96.45. Now the data is out of the way, the participants are focused on the FOMC meeting later in the session.
- FOMC Preview: 13 major banks expectation from June meeting
- US: Weak inflation and growth casts doubt on Fed hiking path - ING
Technical outlook
Now the pair seems to have cleared the Fib. 23.6% retracement of December 2016 - March 2017 uptrend at 0.7600, it could aim for 0.7700 (psychological level) and 0.7750 (Mar. 21 high). On the downside, supports could be seen at 0.7600 (Fib. 23.6%), 0.7540 (100-DMA) and 0.7500 (psychological level).