- The Aussie maintains a bearish tone against the USD, trading near 0.6600.
- The US Dollar is firming up despite softer US CPI figures.
- In Australia, rising inflation expectations have failed to provide support to the AUD.
The Australian Dollar posts marginal losses against the USD in a calm trading session on Friday. The pair retains the bearish trend from the 0.6685 highs, with the support area around 0.6600 under pressure.
The US Dollar is trading moderately higher against its main peers on Friday, unfazed by the soft US Consumer Prices Index (CPI) figures released on Thursday and investors’ hopes that the Federal Reserve (Fed) will cut interest rates further in 2026.
Data released on Thursday showed that US consumer prices grew at a 2.7% year-on-year pace in November, down from 3% in October, while core inflation slowed to 2.6% from 3% in the previous month.
Traders skeptical about US CPI data
Investors have taken these figures with caution. The Commerce Department announced that data collection began in the second half of the month, when Black Friday sales started, which is highly likely to have distorted the final numbers.
The US Federal Reserve cut its benchmark interest rate by 25 basis points last week and projected only one more cut in 2026. Investors, however, remain confident that the bank will be forced to trim rates by at least 0.5% to support a deteriorating labor market.
Data released in Australia earlier this week revealed that Consumer inflation expectations increased to 4.7% in December from 4.5% in November. These figures add to the case that the RBA might hike interest rates in the first quarter of 2026, but the impact on the Aussie has been minimal
