Australian CPI data fuels rate cut expectations

The Australian CPI data came in weaker than expected with the RBA’s preferred inflation gauge the ‘trimmed mean CPI’ was reported Q/Q to rise 0.3% versus the 0.5% expected. The data has given the RBA scope to cut rates although I would suggest the May meeting maybe a little early with the RBA being quite vocal that the effects of previous rate cuts are still working their way through the Australian economy.

It seems twitter will need to review their security following hackers taking control of the Associated press twitter account last night and a sending false tweet of two explosions in the White House that briefly sent the US financial markets reeling.

Following yesterdays poor German PMI data the focus this morning will be on the IFO survey with the consensus headline number being 106.2. If this number disappoints the market I fully expect ECB rate cuts to come into play. The UK will release mortgage data later this morning with the US session bringing us the durable goods number.

EUR/USD

Supports 1.2970-1.2940-1.2920 | Resistance 1.3030-1.3080-1.3125

USD/JPY

Supports 99.15-98.70-98.40 | Resistance 100.00-100.90-101.50

GBP/USD

Supports 1.5215-1.5165-1.5055 | Resistance 1.5300-1.5370-1.5425

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.