The Australian dollar climbed to a three-month high on Wednesday after data showed the country's core inflation gauge accelerated faster than expected. The move came as the broader U.S. dollar stayed range-bound, with traders awaiting U.S. personal consumption expenditures data and Fed Chairman Kevin Warsh's Jackson Hole speech later this week.
The Aussie dollar climbed 0.3% to $0.7183 against the U.S. dollar, its highest level in three months, after fresh inflation figures beat forecasts. The Reserve Bank of Australia's preferred trimmed-mean CPI gauge, its measure of underlying cost-of-living pressures, rose at a quicker-than-expected 3.6% year-on-year.
Dollar holds narrow range near three-month low
Against a basket of six currencies, the U.S. dollar was up 0.1% at 98.988, near the top of the narrow trading range it has held for the past week. The currency has drifted near a three-month low since the Treasury Department moved to cap U.S. long-term bond yields last week.
According to Standard Chartered analysts: "is likely to suffer near-term on the back of an incongruous intervention strategy", they wrote in a research report. The desire to get U.S. rates lower may present another headwind for the dollar and encourage more appetite for carry trades, the analysts added.
Traders await PCE data and Jackson Hole
Traders are focused on the release of U.S. personal consumption expenditures data for July later Wednesday. The report will set the tone ahead of Fed Chairman Kevin Warsh's keynote speech at the Jackson Hole symposium on Friday.
Inflation keeps rate-hike bets alive
Source: Investing.com
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