FxWirePro: Daily Commodity Tracker - 21st March, 2022 
The Australian dollar is down today as the third quarter inflation report underwhelmed. Consumer price inflation rose by 1.8 percent in the third quarter, down 1.9 percent prior and Reserve Bank of Australia’s (RBA) preferred measure of trimmed-mean CPI inflation also rose by 1.8 percent y/y, lower than 2 percent expected.
Weaker than expected numbers has pushed the Australian dollar to trade as low as 0.77 against the dollar, which is the lowest since July. The Aussie has declined steadily since its peak around 0.812 in September. The recovery of the dollar and weaker iron ore price have prompted investors to sell the currency. The price of iron ore, which is the major exporting commodity of Australia has declined from $75 per ton in September to $60 per ton as of today.
Our calculations show that bears are looking to push the Aussie to test key support around 0.72 area. However, we at FxWirePro remain neutral on Aussie as the longer-term bull trend is still in play, which is looking to push the Aussie higher; first towards 0.82, then 0.84, and finally to 0.88. But the bull trend would fail to win the day if no support comes from RBA turning hawkish, higher commodity prices, especially iron ore or higher inflation. Support from a weaker dollar will not be sufficient to push the Aussie higher.
0.75 area is likely to be crucial. Aussie is currently trading at 0.77. Kindly note, all lines are drawn based on closing price.
