Opened in Asia at $1.0319 and after edging up to around $1.0325 came under pressure on cross sales out of Tokyo in the AUD/JPY. The move was then accelerated by the release of very poor CPI data which rose by just +0.1% in Q1 against expectations of a rise of 05-0.8%. Aussie crashed off to $1.0255 before meeting some bids protecting a $1.0250 barrier. Sovereign buying then led a bounce back to $1.0284 before further pressure from AUD/JPY sales led a fall back down flushing the $1.0250 barrier to lows of $1.0247. Bounces have since been restricted to the low $1.0260’s. AUD/JPY collapsed from early highs of Y83.82 tripping stops through Y83.00 to lows of Y82.87, before recovering to Y83.05. EUR/AUD soared from A$1.2732 to A$1.2831. AUD/NZD tanked from NZ$1.2707 to NZ$1.2621. Treasurer Wayne Swan stated that the CPI release showed inflation was contained with growth returning to trend and budget to surplus. Aussie bids are now seen from $1.0225 down to $1.0200 with offers towards $1.0280/90.
EasyForexNews Research Team