Australian economic figures for July topped market forecasts. The stronger consumer price numbers increased the likelihood of an interest rate hike by the Reserve Bank of Australia. Major banks ANZ and CBA adjusted their policy expectations after the data. Both ANZ and CBA now forecast a policy rate hike in November. Westpac maintains a distinct Reserve Bank of Australia policy perspective.
The hotter inflation summary and rising rate increase speculation lifted the Australian dollar up relative to the US dollar. The gain in the exchange rate followed the surprising price data release.