Traders await Australia’s budget deficit forecast of A$25 billion and Q1 wage growth data amid muted AUD response to strong Chinese inflation.
The Australian Dollar traded near 0.7250, failing to break above 0.7280 for a fourth session as markets await key domestic data. Recent attempts to extend gains stalled despite stronger-than-expected Chinese inflation, which typically supports AUD via commodity exports.
China’s April CPI rose 0.3% MoM, beating forecasts, while PPI climbed 2.8% YoY, exceeding expectations. However, focus shifts to Australia’s Federal Budget, where a A$25 billion deficit and A$64 billion in savings are expected. Wednesday’s Wage Price Index, forecast at 0.8% QoQ, will test inflation persistence.
The Aussie’s muted reaction reflects caution ahead of the budget and wage data, with traders weighing domestic inflation risks against broader macroeconomic trends.