RBA Hike Keeps Further Tightening on Table Ahead of Key Inflation Data

The Reserve Bank of Australia (RBA) raised interest rates by 25 basis points to 4.60% in its latest decision, but what's more significant is that it explicitly left the door open for further hikes.

The bank noted that recent inflation has been stronger than expected, which means markets will be closely watching the next Consumer Price Index (CPI) reading.

AUDUSD is currently trading lower ahead of today's session despite the hawkish tone from the RBA. However, a hotter-than-expected CPI reading could support a rebound in the Australian dollar.

From an Elliott Wave perspective, AUDUSD has been approaching potential support around the 0.70/0.6980 area. If price holds this zone, sellers may be running into an area where a bounce can start to develop.