Household Spending Boosts Aussie Dollar as RBA Hike Bets Rekindle

Australia's household spending continued its upward trend in July, rising 1.1% and marking its third consecutive month of increases of at least 1%. This latest data point adds to the growing evidence supporting a potential RBA hike in September.

Household spending has been steadily increasing since March, with four out of the past five months showing growth of at least 1%. Discretionary and non-discretionary spending both saw rises, with discretionary up 7.8% year-over-year and non-discretionary up 5.6%.

The Australian dollar has found renewed support due to these strong economic indicators, while the ASX 200 remains under pressure. Technical analysis suggests that the AUD/USD may face limited upside in the near term, with potential targets including the 72c handle and May 31 high.