RBA Hike Odds Soar as Aussie Dollar Stalls Amid Global Tensions

The Australian dollar has paused its rally near $0.72, its highest level since mid-May, due to escalating Middle East tensions and global risk sentiment.

The tensions rose as Iran and the US attacked tankers in a significant escalation of attacks on shipping since the war began, threatening energy supplies from the Gulf.

This has pushed oil prices above $100 per barrel, exacerbating inflationary pressures that have already affected domestic consumer prices, increasing expectations for a fourth interest rate hike this year.

RBA Deputy Governor Hauser emphasized the focus on whether to raise interest rates, citing persistently high inflation and upside risks.