AUD/USD Nears 11-Week High as RBA Keeps Rate Hike on the Table

The Australian Dollar is holding close to an 11-week high after the RBA minutes showed that another rate hike was more seriously considered than markets had expected.

Several policymakers saw a case for tightening policy again if inflation remains sticky. The RBA ultimately kept rates at 4.35%, choosing to wait for more inflation, employment and growth data before making its next move.

That keeps the door open for another hike later this year.

But AUD/USD has already priced in a lot of optimism. The pair is trading around the 0.7150–0.7200 area after a strong multi-week rally, while momentum is starting to slow near the highs.

The next move will likely depend on whether Australian data gives the RBA enough reason to tighten again.

A hotter inflation reading or stronger economic data could push AUD/USD toward 0.7200 and above. A softer inflation or jobs report, however, could bring rate-hike bets back down and trigger a pullback.

The US side matters just as much. If the Fed turns more dovish at Jackson Hole and US yields fall, the Dollar could weaken further, giving the Aussie another lift.

For now, the bias remains bullish above 0.7100, but with AUD/USD already near multi-month highs, the risk of a pullback is becoming harder to ignore.