Chart: The Aussie Dollar Exploded On Australia's Inflation Data

Image: Getty.

For a benign inflation report the Aussie dollar’s reaction is remarkable.

With a rise of just 0.5% in the June quarter taking the headline CPI rate to the 3% the market expected it would be easy to expect no movement.

Currency traders however have focused on the higher than expected 0.8% rise in the trimmed mean even though it is sitting at 2.9% year-on-year.

The inflation report won’t impact the RBA or the outlook for interest rate stability. But for forex traders? They are clearly sick of being short the Aussie dollar and watching it bounce back strongly from every setback and are short covering.

Chart: Vantage FX

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at