AUD/USD tumbles to near 0.6300 as US Dollar extends recovery, soft CPI

• Australian Dollar declines as subdued inflation dims hopes for aggressive rate cuts, pressuring the Aussie's recent rally.
• US House of Representatives passes Trump's tax cut bill, elevating the Greenback despite uncertain tariff developments.
• Softer growth in Australia's Consumer Price Index intensifies speculation around potential monetary policy actions by the RBA.
• Donald Trump confirmed that tariffs on Mexico and Canada will take effect in April.

AUD/USD falls to near 0.6300 as the US Dollar (USD) extends its recovery. The United States (US) House of Representatives passed President Donald Trump's tax cut bill, boosting the Greenback. Meanwhile, slower-than-expected inflation growth in Australia adds to the Aussie's woes, following last week's 25 basis points rate cut by the Reserve Bank of Australia (RBA).

Daily digest market movers: Aussie battles inflation slowdown and tariffs

• Market participants note subdued growth in the Australian Monthly Consumer Price Index at 2.5% year-on-year, softer than the 2.6% forecast, maintaining concerns about the RBA's inflation outlook.
• The RBA recently lowered its Official Cash Rate to 4.10%, reiterating that controlling inflation is far from complete, and future actions will rely on persistent price and wage signals.
• Softer monthly CPI data fosters uncertainty over Australia's economic resilience, while US President Donald Trump's revived tariff threats keep investors alert to potential disruptions.
• Trump reiterated plans to impose a 25% levy on imports from Canada and Mexico but pushed them to April.
• Investor attention also turns to US Personal Consumption Expenditure Price Index data, a key inflation measure used by the Federal Reserve for guiding interest rate decisions.

AUD/USD technical outlook: RSI near midpoint, momentum falters as pair nears 20-day SMA

AUD/USD sees moderate losses on Wednesday, with the Aussie near 0.6315 after a four-day losing streak. The Relative Strength Index (RSI) hovers in a neutral region but is declining sharply, suggesting a weakening bullish momentum. Meanwhile, the Moving Average Convergence Divergence (MACD) histogram prints decreasing green bars, indicating a loss of upside traction.

Although the pair remains above the 20-day Simple Moving Average, failure to reclaim the 100-day SMA does not imply a major structural shift, and the Aussie may continue to trade within these moving average boundaries unless new data sparks a more decisive move.