{"id":30869,"date":"2026-03-17T06:59:44","date_gmt":"2026-03-17T06:59:44","guid":{"rendered":"https:\/\/www.vtmarketsglobal.com\/en\/uncategorized\/30869\/"},"modified":"2026-03-17T06:59:44","modified_gmt":"2026-03-17T06:59:44","slug":"aussie-dollar-gains-on-hawkish-rba-tone","status":"publish","type":"post","link":"https:\/\/www.vtmarketsglobal.com\/en\/analysis\/30869\/","title":{"rendered":"Aussie Dollar Gains On Hawkish RBA Tone"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.vtmarketsglobal.com\/en\/wp-content\/uploads\/sites\/6\/2026\/03\/Aussie1-1024x573.webp\" alt=\"\" class=\"wp-image-44658\"\/><\/figure>\n\n\n\n<p><strong>Key Points<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>AUDUSD climbed to around 0.7088<\/strong>, extending gains after a <strong>1.3% rally overnight<\/strong>.<\/li>\n\n\n\n<li>The <strong>RBA raised rates to 4.10%<\/strong>, with a narrow <strong>5\u20134 split vote<\/strong>, signalling ongoing inflation concerns.<\/li>\n\n\n\n<li>Markets now price a <strong>40% chance of another hike in May<\/strong>, with <strong>4.35% expected by August<\/strong>.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\"\/>\n\n\n\n<p>The Australian dollar pushed higher on Tuesday, building on recent momentum as markets reacted to a more hawkish-than-expected tone from the Reserve Bank of Australia.<\/p>\n\n\n\n<p><strong>AUDUSD rose toward 0.7088<\/strong>, adding to a strong rally from the previous session, as traders reassessed the path of interest rates following the RBA\u2019s latest policy decision.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Australia\u2019s central bank raised its key interest rate for a second straight meeting on Tuesday, stepping up its battle against stubborn inflation <a href=\"https:\/\/t.co\/luLi5ZrJ76\">https:\/\/t.co\/luLi5ZrJ76<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/2033750359315710204?ref_src=twsrc%5Etfw\">March 17, 2026<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>While the central bank\u2019s <strong>25 basis point hike to 4.10%<\/strong> was widely expected, the reaction was driven by forward guidance rather than the move itself. The decision revealed a <strong>narrow 5\u20134 split<\/strong>, highlighting growing urgency among policymakers to address persistent inflation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Hawkish Messaging Supports the Currency<\/h2>\n\n\n\n<p>RBA Governor Michele Bullock emphasised that the disagreement within the board was not about direction, but timing. The key question was whether to raise rates immediately or wait until May.<\/p>\n\n\n\n<p>This distinction reinforced expectations that <strong>further tightening remains likely<\/strong>, especially with inflation still running above target. <a href=\"https:\/\/t.co\/c6UcVNJyYw\" target=\"_blank\" rel=\"noopener nofollow\" title=\"\">Core inflation<\/a> at <strong>3.4%<\/strong> continues to exceed the RBA\u2019s <strong>2%\u20133% target band<\/strong>, keeping pressure on policymakers to act.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Australia\u2019s central bank is set to deliver back-to-back interest-rate increases on Tuesday driven by the war in Iran and a deterioration in the economy\u2019s supply of workers, according to James McIntyre at Bloomberg Economics <a href=\"https:\/\/t.co\/oH4HZHtyq8\">https:\/\/t.co\/oH4HZHtyq8<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/2031882507533042030?ref_src=twsrc%5Etfw\">March 11, 2026<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>Markets responded quickly. The probability of a <strong>May rate hike increased to 40%<\/strong>, up from 25%, while a move to <strong>4.35% is now fully priced by August<\/strong>.<\/p>\n\n\n\n<p>If inflation remains sticky, AUDUSD may stay supported. However, any signs of easing price pressures could temper expectations for further hikes and cap upside.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Yield Differentials Add Support<\/h2>\n\n\n\n<p>The Australian dollar is also benefiting from supportive yield dynamics. Australian <strong>10-year bond yields are holding near 4.961%<\/strong>, having recently tested the <strong>5.0% level<\/strong>, the highest since mid-2011.<\/p>\n\n\n\n<p>The spread between Australian and U.S. yields has widened to <strong>72 basis points<\/strong>, making Australian assets <a href=\"https:\/\/t.co\/1Xi4AcLOZX\" target=\"_blank\" rel=\"noopener nofollow\" title=\"\">more attractive to global traders<\/a> and supporting capital inflows into the currency.<\/p>\n\n\n\n<p>This yield advantage is a key pillar for AUD strength, particularly in a global environment where central banks are reassessing their policy stance.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Technical Analysis<\/h2>\n\n\n\n<p>The <strong>AUDUSD<\/strong> pair is trading near <strong>0.7067<\/strong>, holding relatively steady despite a slight intraday dip of around <strong>0.05%<\/strong>. Price action suggests the pair is entering a consolidation phase after a sustained uptrend that began in late December, where it rallied from lows near <strong>0.6421<\/strong> to a recent high of <strong>0.7187<\/strong>.<\/p>\n\n\n\n<p>From a technical perspective, the short-term structure remains supported but is beginning to lose momentum. The <strong>5-day (0.7070)<\/strong> and <strong>10-day (0.7065)<\/strong> moving averages are tightly clustered around the current price, indicating a lack of directional conviction. Meanwhile, the <strong>20-day (0.7071)<\/strong> and <strong>30-day (0.7066)<\/strong> averages are also converging, reinforcing the view that the market is compressing and preparing for a potential breakout.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.vtmarketsglobal.com\/en\/wp-content\/uploads\/sites\/6\/2026\/03\/image-22-1024x472.jpg\" alt=\"\" class=\"wp-image-44656\"\/><\/figure>\n\n\n\n<p>Immediate support is seen around the <strong>0.7040\u20130.7050<\/strong> region, where recent pullbacks have stabilised. A break below this zone could open the door toward <strong>0.7000<\/strong>, a key psychological level. On the upside, resistance remains at <strong>0.7180\u20130.7200<\/strong>, marking the recent swing high and a barrier that bulls have yet to decisively clear.<\/p>\n\n\n\n<p>Overall, AUDUSD appears to be <strong>range-bound in the near term<\/strong>, with the broader bullish structure still intact as long as price holds above <strong>0.7000<\/strong>.<\/p>\n\n\n\n<p>However, the current compression in moving averages suggests that a <strong>decisive breakout\u2014either higher or lower\u2014may be approaching<\/strong>, depending on macro catalysts such as US dollar strength or shifts in risk sentiment.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What Traders Should Watch Next<\/h2>\n\n\n\n<p>The near-term direction for AUDUSD will likely depend on whether markets continue to price in further RBA tightening.<\/p>\n\n\n\n<p>Key catalysts include upcoming inflation data, RBA commentary, and shifts in global risk sentiment. Traders will also monitor whether the pair can sustain momentum above the <strong>0.7080 area<\/strong> and challenge the <strong>0.7122 resistance level<\/strong>.<\/p>\n\n\n\n<p>For now, the Australian dollar appears supported by a combination of <strong>hawkish policy expectations, strong yields, and resilient technical structure<\/strong>, though global uncertainties remain a key risk to the outlook.<\/p>\n\n\n\n<p><strong>Learn more about trading <a href=\"https:\/\/www.vtmarkets.com\/forex\/\" target=\"_blank\" rel=\"noopener\" title=\"\">Forex Pairs<\/a> on VT Markets <a href=\"https:\/\/www.vtmarkets.com\/Insights\/\" target=\"_blank\" rel=\"noopener\" title=\"\">here<\/a>.<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">FAQs<\/h2>\n\n\n\n<p><strong>Why is AUDUSD Rising Right Now?<\/strong> <br>The Australian dollar is gaining strength after the Reserve Bank of Australia (RBA) delivered a rate hike and signalled that further tightening remains likely due to persistent inflation risks.<\/p>\n\n\n\n<p><strong>What Did the RBA Decide at Its Latest Meeting?<\/strong> <br>The RBA raised its cash rate by <strong>25 basis points to 4.10%<\/strong>, reaching a 10-month high. The decision was closely contested, with a <strong>5\u20134 split vote<\/strong> among policymakers.<\/p>\n\n\n\n<p><strong>Why Did Markets View the RBA as Hawkish?<\/strong> <br>Governor Michele Bullock indicated the debate was about timing rather than direction, suggesting further rate hikes are still on the table if inflation does not return to target.<\/p>\n\n\n\n<p><strong>What Are Markets Pricing for Future RBA Policy?<\/strong> <br>Markets have increased expectations for another rate hike, with around a <strong>40% probability of a move in May<\/strong>, and a rate of <strong>4.35% fully priced by August<\/strong>.<\/p>\n\n\n\n<p><strong>How is Inflation Affecting the Australian Dollar?<\/strong> <br>Core inflation remains elevated at <strong>3.4%<\/strong>, above the RBA\u2019s target range of 2% to 3%. Persistent inflation supports a hawkish policy outlook, which tends to strengthen the currency.<\/p>\n\n<p>\r\n\r\n<p><strong>Start trading now &#8211; Click <a href=\"https:\/\/www.vtmarketsglobal.com\/en\/trade-now\/\">here<\/a> to create your real VT Markets account <\/strong> <\/p>\r\n<!-- \/wp:post-content -->","protected":false},"excerpt":{"rendered":"<p>AUDUSD rises toward 0.7088 as the RBA hikes to 4.10% and signals further tightening, with markets pricing another move by May. | VT Markets<\/p>\n","protected":false},"author":38,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[3],"tags":[],"class_list":["post-30869","post","type-post","status-publish","format-standard","hentry","category-analysis"],"acf":[],"aioseo_notices":[],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"josephine","author_link":"https:\/\/www.vtmarketsglobal.com\/en\/author\/josephine\/"},"_links":{"self":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/30869","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/comments?post=30869"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/30869\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/media?parent=30869"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/categories?post=30869"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/tags?post=30869"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}