Australian Dollar Dips Ahead of RBA Rate Decision

The Australian dollar has experienced a slight drop after six weeks of gains, with traders awaiting the Reserve Bank of Australia's (RBA) policy meeting on Tuesday. The Aussie lost 0.1% to $0.7063, following a 0.6% rally on Friday that pushed it to a seven-week high of $0.7078.

The currency has been steadily increasing in value, with gains for the second half of the year reaching 2.5%. However, uncertainty remains about the RBA's tone, with some policymakers expected to sound hawkish despite no change in interest rates being predicted.

According to Rodrigo Catril, a senior FX strategist at the National Australia Bank, 'any hawkish language, upward inflation revisions in the Statement on Monetary Policy, or evidence of dissent could see markets revive discussions of a further rate hike later this year.'