Today’s RBA Rate Hike Not Helping AUD/USD - Forex News by FX Leaders
Sellers return for AUD/USD

Today’s RBA Rate Hike Not Helping AUD/USD

Posted Tuesday, December 6, 2022 by
Skerdian Meta • 1 min read

Today the economic calendar has been light, apart from the main event which was the Reserve Bank of Australia (RBA) meeting. This meeting which was held early in the morning kicks off the central bank bonanza for this week, with the Bank of Canada meeting coming up tomorrow before we get to the FED, ECB, BOE, and SNB meetings next week, while the BOJ will close this year on 20 December.

The RBA delivered a 25 basis points (bps) rate hike today. Although despite having hinted that rates have reached neutral levels a few meetings ago, The RBA is still following the playbook, suggesting that more rate hikes are to follow. That gave AUD/USD a small push higher this morning but on the other hand, they are still one of the “softer” central banks these days as they have hiked by 25 bps in recent meetings.

So, the decision today was a predictable one but the main point of the statement was in the final paragraph as the RBA affirmed that “The Board expects to increase interest rates further over the period ahead, but it is not on a pre-set course.” 

But, this pair couldn’t keep the gains and it reversed down as the US session got underway, sending the price below 0.67 as AUD/USD lost 50 pips. The comments about a reopening in China from the Chinese government mouthpiece didn’t help the Aussie much, so sellers have returned and we are changing our bias for this pair and will try to sell retraces higher as we have done in commodities in the last two days, such as Gold and crude Oil.

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