Australian Dollar plunges as CPI falls

© FP

The CPI sank to 0.2% in March, presenting the first inflation drop in seven years that caused the Australian Dollar to lose its value against the US Dollar. The Australian Dollar was trading at $0.7765 before the announcement, surging by 1.50% to $0.7630 after the news came out. The drop in the CPI is an indicator for a potential interest rate cut to sustain the 2-3% annual inflation target set by the RBA.