Australia’s annual inflation slowed to 4.2% in April, below forecasts, reducing bets on an RBA rate hike in June.
The AUD/JPY pair fell to 113.95 in early European trading after Australia’s April Consumer Price Index rose 4.2% year-over-year, below the 4.4% consensus. March’s reading was 4.6%. Monthly CPI increased 0.4%, down from 1.1% in March.
Markets now price a 93% chance the Reserve Bank of Australia will hold rates steady in June, according to the ASX RBA Rate Tracker. The softer inflation print eased expectations for further tightening.
Technical analysis shows the pair remains above its 100-day simple moving average and Bollinger middle band, with resistance at 114.60. The Relative Strength Index at 54 signals modest bullish momentum.