^AXJO Today, January 07: ASX Rises as CPI Undershoots, RBA Odds in Focus
Australia CPI November 2025 slowed to 3.4% year on year, with trimmed mean inflation at 3.2%, both under forecasts. ASX today firmed as the softer print eased RBA rate hike odds, though inflation still sits above the 2% to 3% target band. Tech led early gains while banks trailed. Traders now look to the end‑January quarterly CPI for a more stable read before the February RBA meeting. Positioning stays data‑driven with a focus on rates, growth, and sector rotation.
ASX Today: Risk Appetite Improves After Soft CPI
The ^AXJO edged higher as investors reacted to the softer inflation surprise. Growth names outperformed, with technology and interest‑sensitive stocks gaining as bond yields dipped. Banks lagged on lower rate expectations and margin concerns, while energy eased alongside weaker oil. Turnover was steady. The tone suggests a modest risk‑on bias, but conviction remains tied to incoming data and global leads.
The setup remains neutral. RSI sits near 50, while ADX around 18 signals no strong trend. Price is close to the Bollinger middle band near 8,665, with the upper band near 8,797 and lower band near 8,532. Average True Range is about 67 points, implying a moderate day range. Traders may fade extremes while watching closing strength above the upper band.
Australia CPI November 2025: What the data signals
Australia CPI November 2025 printed 3.4% year on year, with trimmed mean inflation at 3.2%, both below expectations and down from prior months. Inflation still sits above the RBA’s 2% to 3% target, but the direction helps. The ABS monthly series is imperfect, yet the surprise eased pressure on policy. See coverage from ABC News: source.
Monthly CPI is volatile and sensitive to seasonal effects, rebates, and one‑off items, so one soft month is not a trend. Markets now look to the end‑January quarterly CPI for a cleaner signal before the February meeting. A broadening slowdown across services and rents would matter more for policy than goods disinflation alone.
RBA Rate Hike Odds: February Risk vs Mid‑Year Pricing
RBA rate hike odds for February remain a live risk, but the softer Australia CPI November 2025 print tilts the balance toward patience. The Board wants clear evidence that underlying inflation is moving to target. If the quarterly CPI cools again, the case for holding rates strengthens. A re‑acceleration would quickly revive hike risk.
Markets have a 25 bp move fully priced by mid‑year, reflecting caution rather than conviction. For the RBA, trimmed mean inflation at 3.2% must keep trending lower, with wages and services cooling. If momentum fades, pricing could shift to a longer hold. Upside surprises could bring forward tightening and weigh on risk assets.
How Investors Can Position on ASX Today
With Australia CPI November 2025 easing, growth and rate‑sensitive names may keep a bid if yields drift lower. Tech and quality defensives stand out. Banks could lag on margin pressure if the curve flattens. Energy may soften if oil remains under pressure. Focus on balance sheet strength, earnings visibility, and cash generation.
Use levels to frame risk. The Bollinger middle band near 8,665 is first support, while 8,797 is near‑term resistance. ATR near 67 points signals typical intraday swings. Keep stops tight around these bands and reassess if price closes beyond them. Upcoming data can quickly shift trends and invalidate setups. See market wrap: source.
Final Thoughts
Australia CPI November 2025 cooled to 3.4% headline and 3.2% trimmed mean, a welcome step toward the RBA’s 2% to 3% band. ASX today found support as rate expectations eased, lifting tech while banks lagged. The next key catalyst is the end‑January quarterly CPI, which will guide the February decision and reset RBA rate hike odds. For positioning, consider a barbell of quality growth and defensives, watch bank earnings sensitivity to margins, and manage risk with clear levels around the index’s Bollinger bands and ATR. Stay flexible, as one data point does not set the trend.
FAQs
What did Australia CPI November 2025 show?
Australia CPI November 2025 rose 3.4% year on year, while trimmed mean inflation printed 3.2%. Both were below forecasts, easing market pressure on the RBA. The reading is still above the 2% to 3% target, so policy makers want more evidence of sustained progress before declaring victory.
How does the CPI result affect RBA rate hike odds?
The softer CPI lowers near‑term pressure but keeps a February hike as a live risk. Markets fully price a 25 bp move by mid‑year, pending the end‑January quarterly CPI. If core inflation cools further, the RBA may hold. A hot print could bring forward tightening.
Which ASX sectors benefit most from softer inflation?
Growth and rate‑sensitive stocks, such as technology, usually benefit as yields fall and duration lifts. Quality defensives can also gain as earnings visibility improves. Banks may lag if margin pressure rises with lower rate expectations, while energy can soften if weaker growth signals weigh on oil.
What levels matter for the ASX benchmark now?
Traders are watching the Bollinger middle band near 8,665 as first support and the upper band around 8,797 as resistance. ATR near 67 points suggests a typical intraday range. A close above resistance could extend momentum, while a break below support risks a deeper pullback.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.
