Australian Dollar: RBA holds hawkish bias with steady rates – ING
ING’s Chris Turner reports that the Reserve Bank of Australia kept rates at 4.35%, while Governor Michele Bullock delivered a hawkish message, stressing upside inflation risks and revealing that a hike was discussed. Short-dated Australian yields reversed higher.
The Reserve Bank of Australia (RBA) maintained its rates at 4.35% during today's meeting, with Governor Michele Bullock expressing a hawkish stance. She highlighted the potential for upward inflation risks and revealed that the possibility of a rate hike was discussed during the meeting. Short-dated Australian yields reversed higher following the announcement.
ING's FX team expects further RBA hikes this year to be unlikely but anticipates AUD/USD to rise towards 0.73 by the end of the year. Although some argue that a more restrictive policy description implies a lower likelihood of future hikes, Bullock's hawkish remarks suggest the RBA may maintain cautious inflation expectations.
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