AUD Under Pressure as RBA Hikes Interest Rates Again

The Australian Dollar (AUD) weakened by 0.25% to around US$0.6975 on Tuesday (Nov 3) after the Reserve Bank of Australia (RBA) raised its benchmark interest rate by 25 basis points to 4.85%. This marks the RBA’s fifth rate hike of the year.

The move was prompted by persistent domestic inflationary pressure. Australia’s inflation for the third quarter came in at 1.3%—in line with market expectations and higher than the 0.6% recorded in the previous period—signaling that price pressures remain a primary concern for the central bank.

The RBA also noted that inflation risks remain tilted to the upside, with forecasts suggesting that inflation will stay above 3% next year. This leaves the door open for further policy tightening should price pressures prove difficult to contain.

Meanwhile, market attention has shifted toward the United States ahead of the midterm elections and the release of key economic data. Investors will be closely monitoring the JOLTS Job Openings for September, which are expected to reach 7.13 million—a slight increase from the 7.097 million recorded in August.

Future movements in the AUD/USD pair will be shaped by the RBA’s policy outlook and the trajectory of the US Dollar. The JOLTS data serves as an immediate catalyst, ahead of further US labor market figures and the policy outlook from the Federal Reserve. (srh)

Source: Newsmaker.id