Hawkish Fedspeak Takes Precedence Over RBA's Own Hawkish Tilt

The Aussie dollar led losses in G10 FX space Wednesday, with AUD/USD staging a corrective pullback from Tuesday's post-RBA cycle highs. Hawkish Fedspeak took precedence over recent musings re: RBA policy outlook applying pressure to the pair.

• AUD/USD changes hands at $0.7518, a touch higher on the day. A slide through yesterday's low of $0.7534 would shift focus to Mar 29 low of $0.7457, a key layer of support. On the flip side, bulls look to a move through $0.7661, which capped gains on Apr 5. Note that the ascending 50-DMA is quickly approaching the 200-DMA, which (if bullish momentum returns) could result in the formation of a golden cross.
• Post-Sydney close comments from the RBA failed to unearth much in the way of meaningful, fresh information. Deputy Governor Bullock noted that she expects some “upward revision” when it comes to the Bank’s forecast profile, with underlying inflationary pressure now in the economy and talk “on the ground” of rising upward wage pressure. She also noted that A$ appreciation is helping contain price pressures. Meanwhile, Assistant Governor Kent pointed to budget spending being a factor in the Bank’s monetary policy decisions, while he identified a reasonably broad-based inflationary dynamic.
• The Australian Financial Review noted that almost half of their panel of leading economists are now looking for a June cash rate hike, up from just one fifth on Monday. As many as seven major sell-side desks brought forward their tightening bets after the RBA delivered a "hawkish hold" on Tuesday.
• Australian Bureau of Statistics will publish monthly trade data today, with trade surplus expected to have shrank a tad in February.