Australian Inflation Reaches 20-Month High, Boosting Currency

Australia's inflation indicator reaches a 20-month peak, boosting the Australian dollar's value. On Monday, the Australian dollar continued its upward trajectory, with the AUD/USD currency pair trading at approximately 0.6483, reflecting a 0.22% increase during the North American trading session. Last week, the US dollar strengthened against most major currencies, except the Japanese yen, gaining about 1.5% against the Australian dollar. In July, Australia's Melbourne Institute's inflation gauge surged by 0.9% month-over-month, a significant rise from June's 0.1% and the highest since December 2023. This monthly consumer inflation indicator, which complements the quarterly official Consumer Price Index, is likely to raise concerns at the Reserve Bank of Australia. The central bank has been cautious about cutting interest rates amid inflationary pressures. Meanwhile, Australia's quarterly CPI for Q2 decreased slightly to 1.9%, down from 2.2% in Q1, remaining just below the RBA's 2%-3% target range. This data supports expectations of a rate cut at the upcoming August 12 meeting. The RBA had previously surprised markets by holding rates steady last month, citing a need for addition...