• AUD/USD rose to hit 15-month high on Wednesday as hawkish RBA expectation offset Australia’s softer-than-expected CPI release.
• The RBA cut interest rates three times last year to 3.6% but has warned that the next move could be up given the pick-up in inflation.
•Investors see a roughly 39% chance that the RBA could raise rates as soon as February, with focus on Wednesday’s inflation data.
• Australian consumer prices increased less than expected in November, according to Wednesday’s data, but persistent core inflation suggests that markets still see a chance of an interest rate hike as soon as next month..
• Data from the Australian Bureau of Statistics showed that the monthly consumer price index (CPI) remained flat in November, while annual inflation eased to 3.4% from 3.8%.
• Immediate resistance is located at 0.6764(23.6%fib), any close above will push the pair towards 0.6778(Higher BB).
• Support is seen at 0.6717 (Daily low) and break below could take the pair towards 0.6679(38.2%fib)
Recommendation: Good to buy around 0.6750, with stop loss of 0.6700, and target price of 0.6810
