Australian Dollar: Hot CPI bolsters RBA hike prospects – BBH

Brown Brothers Harriman’s Elias Haddad notes AUD/USD has failed to clear its 200-day moving average, but stronger-than-expected Australian inflation data supports the case for further Reserve Bank of Australia (RBA) tightening. Headline and trimmed mean Consumer Price Index (CPI) are running above the RBA’s August projections, prompting futures to increase the implied probability of a November hike to 4.85% and to price in an additional move in Q1, underpinning the Australian Dollar.