Forex Pros - The Australian dollar climbed to a six-day high against its U.S. counterpart on Wednesday, supported by expectations that the Reserve Bank will raise interest rates in the coming months.
AUD/USD hit 1.0878 during late Asian trade, the pair's highest since May 3; the pair subsequently consolidated at 1.0861, gaining 0.23%.
The pair was likely to find support at 1.0735, Tuesday's low and resistance at 1.0951, the high of May 3.
Last week the RBA indicated that interest rates will soon have to rise, saying it expects inflation to rise to the top of its 2%-3% target band and remain there for a sustained period.
Earlier in the day, official data showed that Chinese industrial production and retail sales fell short of market expectations, but consumer price inflation came in slightly higher than expected in April, suggesting that Chinese authorities may tighten policy further. China is Australia's largest trading partner.
The Aussie was also higher against the yen, with AUD/JPY rising 0.14% to hit 87.78.
On Tuesday, Australia's Treasurer Wayne Swan unveiled the government's 2011-12 budget, mapping out an aggressive fiscal consolidation plan that plans for the country's fiscal account's to be returned to a surplus in 2012-13.
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