AUD/USD wavers above 0.6730 ahead of US Inflation

The AUD/USD pair has turned sideways after a sheer downside move to Monday’s low at 0.6715 on a risk-off impulse on the market. The asset is hovering around its fresh monthly low as the US dollar index (DXY) has printed a fresh 19-year high at 108.27.

The AUD/USD pair is hovering around monthly lows at 0.6715, downside remains warranted on risk-off. Volatile prices of fuel and food products are still leading the US CPI higher despite Fed’s policy tightening. Australian jobless rate may decline to 3.8% versus the previous reading of 3.9%.

The Dollar Index extended its gains beyond the prior high of 107.79 on a higher consensus for US Inflation. A preliminary estimate for the plain-vanilla Consumer Price Index (CPI) is 8.7%, higher than the print of 8.6%. While the core CPI may settle lower to 5.7%.

The core CPI does not include fuel or food products and is seen lower, however, the annual CPI that includes both is expected to surge to indicate that the volatile energy bills and food items are still leading the inflation rate significantly despite the deployment of policy restrictive measures by Fed.

Apart from the US CPI, investors will also focus on the US Retail Sales this week. The economic data is expected to come higher at 0.8% than the prior reading of -0.3%.

In Australia, investors are keeping an eye on the employment data, which is due on Thursday. The Employment Change is expected to land at 25k, less-than-half than the prior release of 60.6K. However, the Unemployment Rate will slip to 3.8% vs. 3.9% reported previously.