The Australian dollar remains one of the best-performing G10 currencies against the US dollar this year, despite giving back part of its earlier gains as the greenback recovered following the Federal Reserve’s hawkish shift. AUDUSD is still up roughly 4.6% year-to-date, but momentum has clearly cooled in recent weeks.
Attention now turns to Australia's May CPI report, due on Wednesday. Headline inflation is expected to ease on a monthly basis, helped by lower fuel costs and government fuel tax rebates. However, the Reserve Bank of Australia's preferred inflation measure — the trimmed mean CPI — is forecast to remain sticky, highlighting that underlying price pressures have yet to fully subside.
While inflation remains above the RBA's 2%-3% target range, this week's release is unlikely to be the final word on policy. Markets will still have June and second-quarter inflation data before the central bank's next meeting in August. Nevertheless, a stronger-than-expected reading could reinforce expectations that Australian interest rates will stay elevated for longer.
When?
Australia CPI (May): Wednesday, 24 June at 02:30 GMT / 06:30 GST
Technically Speaking
AUDUSD remains under pressure after failing to sustain a break above major resistance earlier this year. The pair has been trading inside a descending channel since May, with recent price action reflecting a broader consolidation pattern that has developed throughout 2026.
Bullish Scenario
A stronger inflation reading could support the Australian dollar and trigger a recovery toward the 21-day moving average at 0.7062.
A break above this level may expose the upper boundary of the descending channel near 0.7072, while the 50-day moving average at 0.7135 could become the next key resistance zone.
Bearish Scenario
If the US dollar remains supported and Australian inflation fails to surprise to the upside, AUDUSD may continue lower toward channel support at 0.6926.
Below that level, attention shifts to the 200-day moving average at 0.6854. A deeper decline could then expose the broader support area around 0.6730.
According to Bloomberg's probability model, there is a 75.2% chance that AUDUSD remains within the 0.6902–0.7062range over the coming week.
