Solid Gold Berjangka – The Australian dollar weakened against the US dollar in Tuesday’s trading (Nov 3) following another interest rate hike by the Reserve Bank of Australia (RBA). The AUD/USD pair fell by approximately 0.25% to trade around the 0.6975 level, even as the Australian central bank took further tightening measures.
The RBA raised its benchmark interest rate by 25 basis points to 4.85%. This marks the fifth 25-basis-point hike this year, as the central bank continues its efforts to curb persistent domestic inflationary pressures.
The decision was in line with market expectations, following an acceleration in Australian inflation. The Consumer Price Index (CPI) for the third quarter rose by 1.3%—matching forecasts and marking a sharp increase from the 0.6% recorded in the previous period—thereby reinforcing the RBA’s rationale for maintaining a tight monetary policy.
The RBA also emphasized that inflation risks remain skewed to the upside. The central bank projects that inflation will stay above 3% throughout next year, with the risk that higher inflation expectations could become more deeply entrenched. This situation leaves the door open for further tightening should price pressures fail to subside.
Meanwhile, on the US dollar front, investor attention is focused on the US midterm elections and the JOLTS Job Openings data for September. The market anticipates that the number of job openings will rise to approximately 7.13 million, up from 7.097 million previously. Data coming in stronger than expected could bolster the US dollar and exert additional downward pressure on the AUD/USD pair. (srh)