AUD Leads FX Majors As CPI Data Reinforces RBA Rate Hike Bets
Heading into today’s European trading session, the risk tone is cautiously positive. Asia-Pacific indices are mixed, yet volatility measures are subdued and safe-havens weaker.
Leading Asia-Pacific indices to the downside is the Nikkei 225 at -1.17%, followed by the Topix at -0.94% and the ASX 200 at -0.78%. The Hang Seng and CSI 300 are both positive on the session at +0.11% and +2.54%, respectively.
In the FX complex, the cautiously positive risk tone sees JPY leading the majors to the downside, with CHF also broadly weaker against its major counterparts. USD is the exception here, with the currency supported by expectations for further policy tightening from the FOMC.
In contrast and leading to the upside are the commodity-linked currencies, with AUD in pole position, followed closely by CAD and NZD, respectively. Regarding AUD, the antipodean found further support following stronger-than-expected CPI data, reinforcing expectations for further policy tightening from the RBA.
Looking ahead, today’s economic calendar is light on tier one data, although the US session will see comments from ECB President Lagarde, followed early in the following Asia-Pacific session by comments from BoC Governor Macklem.
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