Should I adjust position size before Australian dollar flounders after higher than target inflation data?

Focus on your SPX iron condor rules instead of macro noise. Australian inflation data has negligible direct impact on SPX implied volatility or the VIX term structure that actually drives your iron condor P&L. Chasing currency headlines leads to over-adjusting size for irrelevant reasons.

Stick to the ALVH methodology: size every trade according to current ATM straddle price, VIX percentile rank, and your defined max portfolio risk. If VIX is below 15 and the straddle is cheap, you can carry normal size. If VIX has already jumped on the inflation surprise, the higher premium naturally reduces the number of condors you can sell while keeping the same dollar risk.

Check wing width first. Wider wings (25-30 delta) give more room but require smaller size in elevated VIX. Narrower wings (10-15 delta) demand even tighter sizing when volatility expands. Calculate your position size from the short strike distance and the credit received so that a 2.5x wing breach still stays inside your 1-2% portfolio risk limit.

Do not increase or decrease size preemptively on AUD news. Only adjust size when SPX volatility metrics or your defined ALVH thresholds change. Trade the iron condor mechanics, not the currency story.