May 18, 2022 01:42 GMT
The Aussie dollar takes a hit as local WPI data narrowly missed expectations. Quarterly wage growth held at +0.7% (BBG est. +0.8%), while annual growth printed at +2.4% (BBG est. +2.5%).
- While this may lower the odds of a 40bp move at the Bank’s June meeting, the underlying inflation dynamics, RBA view on Australia’s economic resilience and caution surrounding inflation psychology means that a minimum of a 25p hike should be implemented next month.
- AUD/USD reversed earlier gains and last changes hands at $0.7014, down 14 pips on the day. Familiar technical levels remain in play.
- AUD/NZD last seen at NZ$1.1039, down 11 pips on the day, still within yesterday's range. Next support seen at NZ$1.0982 (May 12 low), with initial resistance at NZ$1.1150 (May 4 high).
- AUD/JPY trades at Y90.66, 26 pips worse off on the day. Bears look for further losses towards May 12 low of Y87.31, bulls keep an eye on May 5 high of Y94.03.