Audusd sees drop, despite Australia’s wage growth and mixed US inflation data

AUDUSD Analysis

Performance after Wednesday
Period	Pct	Chg	Momentum
Wednesday	-0.61%	-39.2 Pips
Week to-date	0.23%	15 Pips
May	0.41%	26.1 Pips

Upcoming key events (London Time)

Thu 02:30 AM AUD Labour Force Monthly Employment Change
Thu 01:30 PM USD PPI excluding Food and Energy sectors (12-mth)
Thu 01:30 PM USD Monthly Retail Trade (1-mth)
Thu 01:40 PM USD Federal Reserve Chair Jerome Powell speech

What happened lately

Australia has experienced an increase in its Wage Price Index for the first quarter of 2024, rising from 0.7% to 0.9%, as reported by the Australian Bureau of Statistics. This rise indicates a positive shift in wage growth, suggesting an improvement in Australian households’ purchasing power and potentially leading to higher consumer spending. The increase in wages could also hint at tightening labor market conditions, which might influence the Reserve Bank of Australia’s future monetary policy decisions, particularly regarding interest rates.

In the United States, there have been noteworthy changes in the Consumer Price Index (CPI). For April 2025, the annual CPI inflation rate decreased slightly to 2.3% from 2.4% in March 2025, according to the Bureau of Labor Statistics. Meanwhile, the monthly CPI inflation rate saw an uptick to 0.2% in April, recovering from March’s -0.1%. This indicates that inflationary pressures persist on a monthly basis despite the annual decline. Moreover, inflation excluding food and energy sectors rose to 0.2% in April from 0.1% in March, with the annual core inflation rate holding steady at 2.8%. These figures point toward persistent core inflationary pressures, which might prompt the Federal Reserve to remain vigilant on inflation control strategies.

The recent economic data releases have a direct impact on the AUDUSD currency pair. The increase in Australia’s wage growth could provide some support for the Australian dollar, as higher wages might lead to stronger domestic economic activity. However, the mixed inflation data from the United States, with rising monthly inflation rates, particularly in core inflation, could keep the U.S. dollar underpinned if the Federal Reserve remains committed to maintaining inflation within its target range. With upcoming high-impact economic events including Australia’s employment change and key data from the U.S. such as PPI excluding food and energy, retail trade figures, and a speech by Federal Reserve Chair Jerome Powell, the AUDUSD pair might see further volatility. The pair’s recent decline by 0.61% to 0.64278 indicates consolidation, and the direction will likely be influenced by how these upcoming events unfold and their implications on monetary policies in both countries.

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What can we expect from AUDUSD today?

AUDUSD on Wednesday dropped -0.61% to 0.64278. Price is above 9-Day EMA while Stochastic is rising.

Updated daily direction for AUDUSD looks mixed as the pair is likely to consolidate above 0.63981 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 0.65010 or trades above daily pivot 0.64495. Break above could target R1 at 0.64793. While to the downside, we are looking at 0.63981 (S1) and daily low of 0.64198 as support levels. AUDUSD need to break on either side to indicate a short-term bias. A close below 0.64198 would indicate selling pressure.

For the week to-date, take note that AUDUSD is mixed as compared to the prior week.

Key levels to watch out:

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