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Australian dollar holds near 0.7050 after RBA decision
With the next RBA meeting about seven weeks away, FX momentum is likely to be driven more by upcoming US data and Fed timing than by further Australian policy.
The Australian dollar held just above 0.7050 against the US dollar on Tuesday, August 11, after the Reserve Bank of Australia left the cash rate unchanged at 4.35% in a unanimous decision.
RBA forecasts published alongside the decision pushed the focus toward what happens after the next meeting gap, because Australia’s next scheduled RBA meeting is September 29, while the Fed meets earlier on September 16. Between those dates, multiple US releases and events including CPI and PPI, retail sales, July meeting minutes, and the Jackson Hole symposium could reprice rate expectations, while Australia’s own decision-relevant catalysts are relatively thin.
FXStreet noted that the RBA’s outlook was not comfortable, projecting inflation returning to around the midpoint of the target band only in late 2027, with risks skewed higher. It also sees unemployment edging up from 4.5% at the end of this year to 4.8% by the end of 2028, and characterized policy as restrictive and tight.
According to FXStreet, the RBA press conference was firmer than the statement, emphasizing that the cash rate could go higher if required and pointing to the recent rise in crude oil as a channel through which firms may pass more costs to consumers. The article also argued that oil strength supports tightening pressures on both the Australian and US rate outlooks.
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