AUD/USD & Aussie bond yields fade post CPI spike

Hardening of the government bond yields in Australia following the upbeat CPI release pushed AUD/USD to a session high of 0.7566 before it fell back to 0.7520 levels.

RBA trimmed mean inflation beat estimates

The official data released just now shows RBA trimmed mean figure bettered estimates by printing at 0.5% q/q and 1.7% y/y. The headline q/q CPI bettered estimates as well, while y/y CPI missed estimate by a slight margin.

Inflation figures for Q2 show a brighter picture. No wonder the 10-yr Australian government bond yield jumped to a high of 1.988% before falling back to 1.966%; up four basis points on the day.

On similar lines, Aussie faded spike to near 0.7570 levels and was last seen trading around 0.7520 levels.

AUD/USD Technical Levels

A break above 10-DMA of 0.7521 (10-DMA) would open doors for a post CPI high of 0.7566-0.7571 (61.8% of 0.7835-0.7145). A violation there could yield 0.76 handle. On the other hand, a breakdown of support at 0.7490 (50% of 0.7835-0.7145) would expose support at 0.7450 (38.2% of 0.6827-0.7835) and 0.7417 (50-DMA).