The AUD/USD currency pair surged near the 0.7190 price zone following the Reserve Bank of Australia's (RBA) decision to raise its cash rate by 25 basis points to 4.35% [1]. This marks the RBA's third consecutive rate hike in 2024, with the decision supported by a strong 8–1 vote, indicating a clear consensus among policymakers compared to previous meetings that saw tighter splits [1]. The RBA emphasized its ongoing commitment to controlling inflation, which it expects to remain above target due to persistent high energy prices and geopolitical tensions [1].
Despite the rate hike, the RBA's communication was described as more balanced, which limited a stronger reaction in the Australian Dollar. Policymakers signaled a shift toward a more data-dependent approach, suggesting the possibility of pausing further rate hikes to assess incoming economic information [1].
On the US side, recent economic data presented a mixed but generally supportive outlook for the US Dollar. The JOLTS Job Openings declined slightly to 6.866 million from 6.922 million, indicating a gradual cooling in labor demand while still reflecting a tight labor market [1]. The ISM Services PMI registered at 53.6, down from 54.0, but remained in expansionary territory, with underlying components such as Business Activity and New Orders showing continued resilience [1]. This data supports expectations that the Federal Reserve can maintain a restrictive policy stance, although the US Dollar weakened amid improved risk sentiment [1].
Technical analysis shows AUD/USD trading at 0.7194 with a constructive short-term bias, supported by the 20-period SMA at 0.7185 and the 100-period SMA at 0.7157. The Relative Strength Index (14) is around 56, indicating steady bullish momentum. Immediate resistance is noted at 0.7195, with support levels at 0.7185, 0.7174, 0.7167, and deeper demand at 0.7157 and 0.7152 [1].
CONCLUSION
The RBA's third consecutive rate hike and a more balanced policy outlook have driven AUD/USD higher, though gains were capped by cautious forward guidance. US economic data remains supportive but points to a controlled slowdown, contributing to a weaker US Dollar. Market participants are now focused on future RBA decisions and incoming economic data.