Australian dollar traders are looking at a busy day tomorrow with the Reserve Bank of Australia set to make its latest interest rate call early in the Sydney afternoon session. Although the bank is strongly favoured to keep interest rates on hold at 4.35%, the market is expecting plenty of volatility in the currency around the forward guidance that it receives from the bank in the Policy Statement, Rate Statement and subsequent Press Conference with Michele Bullock later in the day.
The last quarterly inflation data came in lower than expected which removed the chance of a hike at this meeting, which had been priced in at nearly 30% prior to the data release, however CPI still remains relatively sticky at 3.8% and the RBA has been clear to the market previously that it did not feel its tightening cycle had finished. The jobs market has remained resilient throughout 2026 and the last update came in stronger than expected which also adds to the case for another potential hike in the coming months, and then the wildcard situation in the Middle East of the potential for more spikes in energy prices will also remain a strong factor.
The Aussie dollar has risen nicely over the last several weeks, gaining over 3% against the greenback as geopolitical risks have reduced and the US has seen weaker data prints and a resolutely hawkish RBA could see that move extend further after the meeting with initial resistance now around 0.7240 on the Daily chart. However, a less hawkish update from the bank could see some strong selling pressure hit the currency with initial support now coming in on the trendline just under the 0.6950 level.
Resistance 2: 0.7277 – 2026 High
Resistance 1: 0.7241 – Trendline Resistance
Support 1: 0.6943 – Trendline Support
Support 2: 0.6924 – 200 Day Moving Average
