The Australian Dollar has outperformed, driven by optimism over global growth and rising commodity prices. Recent inflation data from Australia has reinforced expectations for a rate hike by the RBA in February, Analysts are closely monitoring the impact of these developments on the AUD's trajectory, reports Lee Hardman, Senior Currency Analyst at MUFG.

Commodity prices boost Australian Dollar

"While the outperformance of the Australian dollar has been encouraged by building optimism over stronger global growth and rising commodity prices alongside market expectations for the RBA to hike rates at the start of this year."

"The latest CPI report revealed that headline inflation unexpectedly picked up to 3.8% in December moving further away from the RBA’s target."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)