AUD Extends Nine-Week Winning Streak on Rate Hike Expectations

The Australian dollar has extended its winning streak to nine weeks, reaching a new three-month high of $0.7204 after a hot inflation report lifted the odds of an imminent interest rate hike.

The Reserve Bank of Australia's (RBA) interest rate outlook has shifted, with markets now wagering on a 52% probability that the fourth rate hike this year could come as soon as next month.

Ray Attrill, head of FX strategy at the National Australia Bank, sees near-term AUD upside risks increasing, but notes that medium-term fundamentals remain less supportive due to additional tightening weighing on 2027 growth and ultimately prompting RBA rate cuts.