AUD/USD to consolidate in the 0.7200/0.7250 region – ING
Another tick higher in inflation, but the Reserve Bank of Australia (RBA) tightening is still far. Analysts at ING believe that the AUD/USD pair could build some support at 0.72.
Tick-up in inflation to provide some help
“The 4Q inflation report published tonight in Australia should see a mild acceleration in the headline rate from the latest 3.0% read. This could keep hawkish expectations on the Reserve Bank of Australia alive and help build a floor under the Aussie dollar.”
“The current pricing for RBA tightening seems unrealistic, which poses downside risks further down the road for AUD. Until some sort of reality check from the RBA forces some re-pricing of rate expectations, the very oversold AUD could find some support in periods of stable risk sentiment, although the exposure to China and its zero-covid policy should continue to put a curb on any sustained rally.”
“This week, we could see AUD/USD consolidate in the 0.7200/0.7250 area.”