AUD/USD: Breakout extends with CPI surprise – Societe Generale

Societe Generale analysts note that AUD/USD has broken out of a multi‑month consolidation and is trading near its 2023 peak after a stronger‑than‑expected Australian core CPI print. The report highlights nearby support and resistance levels, outlines upside technical targets, and stresses that RBA pricing now fully discounts a second 25 bp rate hike to 4.10% in May.

Breakout holds as RBA priced higher

"Spot reclaims 0.71-handle in biggest gain since 11 February (0.74%) following above forecast January CPI."

"Australia January headline CPI unchanged at 3.8%, core trimmed mean ticks up to 3.4% from 3.3% (+0.3% m/m)."

"A second rate increase by the RBA to 4.10% is fully discounted for May."

"AUD/USD broke out of a multi month consolidation base and recently revisited the 2023 peak at 0.7150. Following this move, the pair has entered a brief consolidation phase, with no clear indications yet of a downside reversal. Should a short-term pullback unfold, the February low at 0.6890 is expected to serve as initial support."

"The breakout from the previous wide range highlights possibility of further upside. Beyond 0.7150, next objectives could be located at projections of 0.7220 and 0.7400."

"Gov Bullock speaks late, capex data tonight."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)