AUD/USD surges to 0.7022 as Australian CPI exceeds expectations

AUD/USD jumped to 0.7022, its highest level since February 2023, following stronger-than-expected Australian inflation data. The Trimmed Mean CPI came in at 3.8% year-over-year for the quarterly reading, exceeding the 3.6% forecast. Nearly all inflation readings printed higher than anticipated, significantly increasing the probability of a Reserve Bank of Australia rate hike on February 3rd. The Australian dollar gained approximately 0.5% against the US dollar immediately following the data release. The persistently elevated inflation figures suggest the RBA may need to maintain its hawkish stance longer than previously expected, providing fundamental support for the Aussie. Technical resistance now sits at the 0.7050 psychological level, while support has formed at 0.6980. Traders should monitor upcoming RBA communications closely, as any hawkish rhetoric could propel AUD/USD toward the 0.7100 handle.