AUD/USD continues rising after US core PCE beats estimates with fifth up-day in a row

Source Fxstreet
  • AUD/USD extends rally after US core PCE beats estimates 
  • The lack of a reaction may be as a result of the US Dollar already pricing in inflationary GDP data on Thursday. 
  • Higher Australian factory gate inflation data overnight added a tailwind to AUD/USD.  

AUD/USD trades in the 0.6540s as it continues rallying after the release of US core Personal Consumption Expenditures Price (PCE) Index data for March. Despite the data showing a higher than expected rate of inflation, the US Dollar (USD) shows little reaction in most pairs, including AUD/USD, which looks like it will clock up its fifth daily gain in a row assuming a bullish close on Friday. 

US core PCE came in at 2.8% YoY in March – higher than the 2.6% expected and the 2.8% previous, whilst headline PCE rose 2.7%, which was also higher than the 2.6% expected and 2.5% previous. On month, the PCE data came out in line with expectations. 

The US Dollar’s lack of reaction could be put down to its already pricing in inflationary GDP data for the first quarter on Thursday, which pre-empted the inflationary core PCE data. 

Although the rate of US GDP growth slowed in Q1, the GDP Price Index component, which measures goods inflation, rose much higher than previously. As a result of the data the US Dollar strengthened in most pairs and AUD/USD pared its earlier gains, falling to a low 0.6486 after the release. 

Australian factory price inflation data out overnight, however, gave fresh impetus to the pair, after it showed a rise 4.3% YoY in Q1 from 4.1% in the previous quarter. The Producer Price Index (PPI) data added further evidence of price pressures in the Australian economy after Q1 CPI data beat expectations on Thursday giving a lift to AUD/USD in the process. 

Persistent inflation means the Reserve Bank of Australia (RBA) is seen as the last G10 bank likely to cut interest rates, with some analysts now delaying calls for an RBA rate cut until February 2025. The expectation that Aussie interest rates will fall more slowly than in other countries is supportive for the AUD as relatively higher interest rates attract greater capital inflows.

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Fed hike odds near 90% into Wednesday's decision — how to trade the dollar, gold and the S&P 500A 0.3% monthly core CPI print has lifted the market-implied probability of a 25bp Fed hike on 16 September to roughly 86.5% ~ 90%, which would be the first increase since July 2023. Here is the decision timeline, the pricing versus the forecasts, both scenarios, and the key levels for the dollar, gold and the S&P 500.
Author  Suzie
Sep 14, Mon
A 0.3% monthly core CPI print has lifted the market-implied probability of a 25bp Fed hike on 16 September to roughly 86.5% ~ 90%, which would be the first increase since July 2023. Here is the decision timeline, the pricing versus the forecasts, both scenarios, and the key levels for the dollar, gold and the S&P 500.
placeholder
【Daily Brief】10-year Treasury yield briefly tops 5%, S&P 500 slips to 7,602 and the dollar firms at 99.3 as the Fed's decision eve beginsThe 10-year Treasury yield touched 5.014% on Monday — its first print above 5% since October 2023 — while the S&P 500 closed 0.48% lower at 7,619.98 and the dollar index firmed to 99.3. Here is the full market wrap ahead of Wednesday's FOMC decision, the dot plot and the August retail sales report, plus today's CLARITY Act Senate vote.
Author  Irene Q.
Sep 15, Tue
The 10-year Treasury yield touched 5.014% on Monday — its first print above 5% since October 2023 — while the S&P 500 closed 0.48% lower at 7,619.98 and the dollar index firmed to 99.3. Here is the full market wrap ahead of Wednesday's FOMC decision, the dot plot and the August retail sales report, plus today's CLARITY Act Senate vote.
placeholder
Silver breaks $64 as precious metals rebound — can gold hold the $4,280 line into the Fed decision?Silver has climbed back above $64 an ounce for the first time this week, leading a broad rebound across precious metals hours before the Federal Reserve delivers what is expected to be its first rate hike since 2023. Spot silver was last at $64.64, up 1.49% on the day, while gold reclaimed $4,300 and platinum and palladium both advanced. The question now is whether the bounce is a genuine turn — or a pause before the Fed's dot plot decides the next move.
Author  Suzie
22 hours ago
Silver has climbed back above $64 an ounce for the first time this week, leading a broad rebound across precious metals hours before the Federal Reserve delivers what is expected to be its first rate hike since 2023. Spot silver was last at $64.64, up 1.49% on the day, while gold reclaimed $4,300 and platinum and palladium both advanced. The question now is whether the bounce is a genuine turn — or a pause before the Fed's dot plot decides the next move.
placeholder
Bitcoin falls below $75,000 as the CLARITY Act fails in the Senate — what the vote means for cryptoThe US Senate blocked the Digital Asset Market CLARITY Act in a 49-50 procedural vote, sending Bitcoin briefly below $75,000 — its biggest one-day drop since June. Ethereum fell more than 8%, Coinbase slid 10% and $75 billion of crypto market value evaporated. Here is what the vote was, why it failed, and the levels that matter now.
Author  Suzie
22 hours ago
The US Senate blocked the Digital Asset Market CLARITY Act in a 49-50 procedural vote, sending Bitcoin briefly below $75,000 — its biggest one-day drop since June. Ethereum fell more than 8%, Coinbase slid 10% and $75 billion of crypto market value evaporated. Here is what the vote was, why it failed, and the levels that matter now.
placeholder
Dow drops 631 points as the Fed hikes — but futures are rebounding: what's next for US stocks?The Dow fell 631 points and the S&P 500 closed below 7,600 after the Fed hiked rates for the first time since 2023, with the dot plot showing 16 of 18 officials expect more tightening. Asia-session futures are already recovering — here are the levels and analyst views that decide whether 7,500 holds.
Author  Irene Q.
4 hours ago
The Dow fell 631 points and the S&P 500 closed below 7,600 after the Fed hiked rates for the first time since 2023, with the dot plot showing 16 of 18 officials expect more tightening. Asia-session futures are already recovering — here are the levels and analyst views that decide whether 7,500 holds.
Related Instrument
goTop
quote