- AUD/USD remains in the red post-below-forecast China CPI and PPI readings.
- The drop in the CPI means the PBOC has more room to stimulate the economy. The risk assets, therefore, could cheer the decline in the CPI, capping the downside in the Aussie dollar.
The Aussie dollar is extending losses as China’s factory-gate inflation released soon before press time highlighted growing pressure on the world’s second-largest economy.
The producer price index (PPI) or factory-gate inflation, a measure of the prices businesses receive for their goods and services, rose 0.9 percent in December from a year earlier, compared with a 2.7 percent increase in November. Meanwhile, the consumer price index (CPI) also ticked lower to 1.9 percent from 2.2 percent.
The moderation in PPI is indeed bad news for commodities and commodity dollars like the AUD. However, with cooling consumer inflation, the PBOC has more room to stimulate the economy. The risk assets, therefore, could pick up a bid, and cap downside in the Australian dollar.
As of writing, the AUD/USD is trading at 0.7154, having hit a session low of 0.7146 post-PPI release.
AUD/USD Technical Levels
Today Last Price: 0.7156
Today Daily change: -25 pips
Today Daily change %: -0.348%
Today Daily Open: 0.7181
Previous Daily SMA20: 0.7097
Previous Daily SMA50: 0.7189
Previous Daily SMA100: 0.7179
Previous Daily SMA200: 0.7336
Previous Daily High: 0.7194
Previous Daily Low: 0.713
Previous Weekly High: 0.7125
Previous Weekly Low: 0.6684
Previous Monthly High: 0.7394
Previous Monthly Low: 0.7014
Previous Daily Fibonacci 38.2%: 0.717
Previous Daily Fibonacci 61.8%: 0.7154
Previous Daily Pivot Point S1: 0.7143
Previous Daily Pivot Point S2: 0.7104
Previous Daily Pivot Point S3: 0.7079
Previous Daily Pivot Point R1: 0.7207
Previous Daily Pivot Point R2: 0.7232
Previous Daily Pivot Point R3: 0.7271