AUDUSD Hits a 12-Week High on Hot July Inflation
AUDUSD hit a 12-week high as hotter than expected July inflation fueled the risk of another rate hike.
Monthly CPI rose 1.0% in July against a 0.8% forecast. Annual eased to 3.5% from 3.8%, but stayed above the 3.3% expected. The trimmed mean, the RBA's preferred core measure, rose 0.5% against a 0.3% forecast, leaving annual core at 3.6%. Nonetheless RBA is seeing elevated inflation.
The monthly spike was driven by fuel, up 7.5% after three months of falling, on higher world oil prices. Remember, Australia is not a net-exporter like the U.S. I'd say that's the Middle East war showing up directly in the data. As long as oil stays elevated and the region stays unresolved, the RBA is on alert. Bullock said another hike is quite possible.
Hike odds jumped to 27% from 17%. February is priced at 80%.
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— Alan
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2August 26, 2026 2.6K 2
