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AUDUSD rises to four-month high as RBA hike odds increase
AUDUSD has extended its run from 0.7121, with expectations pointing to a 25 basis point RBA hike on Sep 29 from 4.35% to 4.60% and borrowing costs near 4.85% into 2027.
AUDUSD extended its uptrend from a 0.7121 higher low for a fifth straight day, reaching its highest level in nearly four months versus the US dollar, according to Action Forex.
The move has been supported by growing expectations for a Reserve Bank of Australia rate hike at the policy meeting on Sep 29, with RBA policymaker comments highlighting inflation concerns despite easing, with July inflation at 3.5% and still well above the 2% target.
Action Forex also flagged upside risks to inflation from escalation in the Middle East crisis, which could keep RBA officials on alert and lift the odds of further tightening beyond September.
Technical signals are also flashing caution for bulls, with Daily RSI near overbought territory and stochastic already overbought, while the article cites potential support around 0.7200 and a pullback zone tied to the 76.4% Fibonacci level of 0.7277/0.6865 and the 10-day moving average.