Australian Dollar Slides On Disappointing Inflation Data

The Australian dollar slipped against its major counterparts in the Asian session on Wednesday, as nation's inflation missed forecasts in the first quarter, stocking hopes for a rate cut by the Reserve bank of Australia in coming months.

Data from the Australian Bureau of Statistics showed that the consumer price index rose 0.1 percent on a seasonally adjusted basis in the first quarter, following a rise of 0.4 percent in the fourth quarter. Economists had forecast a 0.2 percent rise.

On a year-on-year basis, the CPI rose 1.3 percent after an increase of 1.8 percent in the previous quarter. Economists had expected a 1.5 percent rise in inflation.

Investors awaited U.S.-China trade talks. According to U.S. Press Secretary Sarah Huckabee Sanders, U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin will head to Beijing next week for talks that start on April 30.

Following those talks, Chinese Vice Premier Liu He will lead a delegation to Washington for further discussions that begin on May 8.

The aussie depreciated to 0.7027 against the greenback, its lowest since March 11. The aussie is seen finding support around the 0.69 level.

The aussie that closed yesterday's trading at 79.44 against the yen fell to a 3-week low of 78.50. The next possible support for the aussie is seen around the 77.5 level.

The aussie weakened to more than a 4-week low of 1.5959 against the euro, compared to 1.5809 hit late New York Tuesday. If the aussie drops further, 1.62 is possibly seen as its next support level.

The Australian currency slipped to a 3-week low of 0.9450 against the loonie from yesterday's closing value of 0.9533. Next key support for the aussie is likely seen around the 0.92 level.

The aussie hit a weekly low of 1.0617 against the kiwi, down from Tuesday's closing value of 1.0668. The aussie is poised to find support around the 1.05 level.

Looking ahead, German Ifo business climate and Swiss economic sentiment index for April, as well as U.K. public sector finance data for March are due in the European session.

The Bank of Canada announces its interest rate decision at 10:00 am ET. Economists expect the bank rate to remain on hold at 1.75 percent.