AUD/USD traders eye Aussie inflation and China PMIs to assess RBA policy direction and trade-linked risks.
The AUD/USD faces a pivotal session on April 30 as investors await Q1 Aussie inflation data. Economists forecast the RBA trimmed mean CPI to soften from 3.2% in Q4 2024 to 2.9% in Q1 2025, falling within the RBA’s 2-3% inflation target range.
A lower-than-expected inflation reading may raise bets on a May RBA rate cut and dovish outlook, weighing on the Aussie dollar. In contrast, a higher trimmed mean CPI could dampen expectations of a May rate cut, potentially sending the Aussie dollar higher.
In addition to inflation, investors should consider trade headlines and China’s private sector PMI data. China, which accounts for around one-third of Australia’s exports, plays a vital role in AUD trends. A slowdown in Chinese demand or renewed US-China tensions could reinforce dovish RBA sentiment. Positive Chinese data and easing trade tensions may boost Aussie demand.
Aussie Dollar Daily Outlook: Will US Data Widen the Rate Differential?
In the US session, upbeat labor market data and higher inflation may sink Fed rate cut bets. A more hawkish Fed policy outlook could widen the US-Aussie rate differential in the US dollar’s favor, potentially dragging AUD/USD below $0.63623.
Conversely, softer US inflation could fuel Fed rate cut expectations, sending AUD/USD toward $0.65.
