AUD/JPY gathers strength above 100.00 on hot Australian CPI inflation data

أسواق الإمارات اليومOctober 29, 2025

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AUD/JPY gains ground around 100.30 in Wednesday’s Asian session.
Australia’s CPI inflation rose to 1.3% QoQ in Q3, hotter than expected.
The BoJ is widely expected to keep its policy rate steady at the October meeting on Thursday.

The AUD/JPY cross trades in positive territory near 100.30 during the Asian trading hours on Wednesday. The Australian Dollar (AUD) strengthens against the Japanese Yen (JPY) on the hotter-than-expected Australian inflation data. The Bank of Japan (BoJ) interest rate decision will take center stage later on Thursday.

Data released by the Australian Bureau of Statistics (ABS) on Wednesday showed that Australia’s Consumer Price Index (CPI) rose 1.3% QoQ in the third quarter (Q3), compared with the 0.7% increase recorded in Q2. This figure came in above the market consensus of a 1.1% growth.

Meanwhile, Australia’s CPI inflation climbed to 3.2% YoY in Q3 versus 2.1% prior and hotter than the 3.0% expected. The monthly Consumer Price Index rose by 3.5% YoY in August, compared to the previous reading of a 3.0% increase. This figure exceeded analyst expectations of 3.1%.

The Aussie edges slightly higher in an immediate reaction to the hotter Australian CPI inflation report, as it might reduce the chance of a near-term interest rate cut by the Reserve Bank of Australia (RBA).

On the other hand, the comments from Japan’s Prime Minister Sanae Takaichi and US Treasury Secretary Scott Bessent eased some concerns about more expansionary fiscal and monetary policy in the country. This, in turn, could provide some support to the JPY. US Treasury Secretary Scott Bessent said on Wednesday that the government’s willingness to allow the BoJ policy space will be key to anchoring inflation expectations and avoiding excess foreign exchange (FX) volatility.

The BoJ is broadly expected to hold its interest rate steady at 0.5% at its upcoming policy meeting on Thursday. Traders will closely monitor the guidance from BoJ Governor Kazuo Ueda following the meeting for fresh impetus.

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