CBA share price was in the red on Wednesday, its third consecutive fall this week, as the Australian key inflation data suggested a decline. The Commonwealth Bank of Australia (CBA) has been under intense pressure this year amid the recent debacle in the US banking sector. The Australian bank has slipped by more than 4% in the year to date, with its market cap crashing to A$168.65 billion.
Australian Economic Outlook
CBA share price ASX has been treading waters for the past few weeks, dropping more than 11% from its highest point this year in February. The Australian benchmark S&P/ASX 200 index was trading lower on Wednesday off the back of declines in mining and financial stocks. The Australian dollar also ticked lower in the wake of a decline in inflation.
Statistics by the Australian Bureau of Statistics (ABS) show that the Consumer Price Index (CPI) rose 1.4% in the first quarter, down from 1.9% in the previous quarter. Annual inflation rose 7.0% in the March quarter, easing from the 30-year high inflation of 7.8% recorded in the December quarter.
Goods annual inflation declined after two years of consistent increases, from 9.5% to 7.6%, due to discounts on household appliances and a fall in automotive fuel prices. On the other hand, services annual inflation jumped to its highest level in more than a decade, buoyed by higher prices for holiday travel, medical services, restaurant meals, and rents.
Despite the decline in inflation, the CPI reading remains slightly above the consensus analysts’ estimates of a 1.3% rise. Markets will be closely watching the Reserve Bank of Australia (RBA) ahead of its next RBA Board meeting and Official Cash Rate announcement next week on Tuesday.
CBA Share Price Forecast
The daily chart shows that the CBA share price has been under intense pressure for the past few weeks. Despite the pullback, the stock remains slightly above the 50-day moving average but has remained below the 100-day moving average. Its Relative Strength Index (RSI) has ticked lower but remains in the neutral zone.
As such, the CBA stock price is likely to fall further as focus shifts to the RBA meeting and Wall Street earnings. A drop below the important support level of $97.15 will have bears eyeing the next support at $93.20. However, a move past the 100-day MA at $102.85 will invalidate the bearish thesis.