Traders and investors are closely watching the upcoming release of the U.S. Consumer Price Index (CPI) and Producer Price Index (PPI) data, scheduled for the second week of February. These inflation reports are among the most influential economic indicators for the Federal Reserve’s monetary policy decisions and, by extension, for major currency pairs like AUD/USD.
Release Schedule and Market Expectations
The U.S. Bureau of Labor Statistics will release the January CPI report on Wednesday, February 12, 2026, at 8:30 a.m. ET. The PPI data, which measures wholesale inflation, is scheduled for Thursday, February 13, at the same time. Economists polled by major financial news outlets expect headline CPI to show a modest deceleration, with core CPI—excluding food and energy—forecast to remain sticky above the Fed’s 2% target. PPI is anticipated to reflect continued input cost pressures in the services sector.
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These releases follow a period of mixed economic signals. The U.S. labor market remains resilient, but consumer spending has shown signs of cooling. Any upside surprise in inflation data could reinforce the Fed’s cautious stance on rate cuts, while softer readings might reignite expectations for a pivot later in the year.
How Inflation Data Influences AUD/USD
AUD/USD is highly sensitive to shifts in the interest rate differential between the U.S. and Australia. Higher-than-expected U.S. inflation tends to push the dollar higher, as it reduces the likelihood of near-term Fed rate cuts. Conversely, weaker inflation data can weigh on the greenback, providing support for the Australian dollar.
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Currently, the Reserve Bank of Australia (RBA) is also grappling with its own inflation dynamics. Australian CPI has moderated but remains above the RBA’s target band. The interplay between U.S. and Australian inflation trajectories will be critical for AUD/USD direction. If U.S. data surprises to the downside while Australian inflation remains elevated, the pair could break above recent resistance levels near 0.6600.
Technical Levels to Watch
From a technical perspective, AUD/USD has been trading in a narrow range between 0.6450 and 0.6600 over the past month. A breakout above 0.6600 could open the door to a test of the 200-day moving average near 0.6680. On the downside, a break below 0.6450 would expose the 2024 low around 0.6340. The CPI and PPI releases are likely to provide the catalyst for the next directional move.
Conclusion
The upcoming CPI and PPI reports represent a significant event risk for currency markets. Traders should prepare for potential volatility around the release times and consider the broader context of Fed and RBA policy expectations. While the data will not single-handedly determine the long-term trend, it will shape the near-term narrative for AUD/USD.
FAQs
Q1: What time are the CPI and PPI reports released?
The CPI is released at 8:30 a.m. ET on Wednesday, February 12, 2026, and the PPI at the same time on Thursday, February 13.
Q2: How do CPI and PPI differ in their impact on AUD/USD?
CPI measures consumer inflation and directly influences Fed rate expectations. PPI measures wholesale inflation and can signal future consumer price trends. Both affect the U.S. dollar, but CPI typically has a larger immediate market impact.
Q3: What should traders watch beyond the headline numbers?
Core CPI and core PPI (excluding food and energy) are often more closely watched by the Fed. Also, components like shelter costs in CPI and services inflation in PPI provide deeper insight into underlying price pressures.
