Before the announcement of an increase in the Wage Price Index, the AUD/USD currency pair trended higher in the early hours of Monday morning (WPI). Economic analysts expected a 0.7 percent increase in the fourth quarter, compared to 0.6 percent in the previous quarter.

The Australian Bureau of Statistics expects to release the Wage Price Index on February 24, 2021. It’s a metric for rising labor prices and tightening labor markets. The Reserve Bank of Australia considers this when determining interest rates. A high number for the AUD is positive (or bullish), while a low reading is negative (or bearish).

The Australian dollar is now trading at around 0.7205, which is fairly good. The pair appears to be trading within an upward channel on the chart.

On the other hand, markets began the week on a cautious note due to escalating geopolitical tensions over the weekend, with Russia and Belarus intensifying military drills in the eastern region of Ukraine. The news that US President Joe Biden had agreed to meet with Russian President Vladimir Putin brought some solace and allowed risk flows to resume. On Monday, US markets will be closed in commemoration of Presidents Day.

Conclusion

The AUD/USD currency pair appears to be on the verge of a short-term upward surge. As a result, short- to medium-term traders may find it lucrative to buy the pair around the current level.