AUD/USD: Muted response to above-forecast Australian wage price index

• Australian Dollar sees little action after above-forecast Australian wage growth data.
• The wage price index rose 0.6% quarter-on-quarter in the second quarter.

Australia reported a better-than-expected wage growth data for the second quarter at 01:30 GMT, but so far, the AUD has failed to pick up a strong bid.

The AUD/USD pair rose ten pips to hit a session high of 0.6809 immediately after the upbeat data hit the wires and is now trading largely unchanged on the day at 0.6797.

The Australian wage price index rose 0.6% quarter-on-quarter in the second quarter, beating the estimated print of 0.5%. The annualized figure came in at 2.3% as expected.

The RBA expects higher wages to lead to higher consumption and inflation, so the better-than-expected wage price index should have put a bid under the AUD.

The Australian currency, however, is not impressed, which indicates the investors believe the wage growth data is not strong enough to deter the RBA from cutting rates further in the near future.

These fears could be bolstered if Chin's retail sales and industrial production data due at 02:00 GMT, prints well below estimates. In that case, the AUD/USD will likely fall toward Tuesday's low of 0.6746.

On the other hand, an above-forecast data could lift the AUD/USD pair to levels above 0.68.

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