• Australian Dollar loses ground in response to cooler-than-expected inflation data.
• Australian Consumer Price Index was unchanged at 3.4% for January, against the expected 3.5%.
• RBNZ held the OCR unchanged at 5.5% in its February monetary policy meeting.
• The US Dollar could face a challenge on subdued US Treasury yields.

The Australian Dollar (AUD) faces challenges following the release of cooler-than-anticipated Monthly Consumer Price Index (CPI) data from Australia on Wednesday. Furthermore, the decline in the S&P/ASX 200, which followed subdued price action on Wall Street overnight, added to market uncertainty ahead of the release of a series of economic data from the United States (US).

Australian Bureau of Statistics showed no change in the price of a fixed basket of goods and services acquired by household consumers. The Monthly Consumer Price Index (CPI) was unchanged at 3.4% for January, which was below market expectations of 3.5%. Investors are now turning their attention to the release of Australian Retail Sales data on Thursday for additional insights into the economic outlook.

The US Dollar Index (DXY) maintains stability as investors await the release of the preliminary Gross Domestic Product Annualized (Q4) from the United States, scheduled for Wednesday. Market expectations anticipate the GDP to remain consistent at 3.3% in the fourth quarter of 2023. The Federal Reserve (Fed) has indicated caution regarding hastily reducing rates, leading to a reduced likelihood of any rate cut in March, which puts downward pressure on the US Dollar (USD).