Australian Dollar Extends Losses

2025-12-17 03:15 By Joshua Ferrer 1 min. read

The Australian dollar depreciated to below $0.662 on Wednesday, extending losses for a fifth straight session, as investors continued to weigh the prospect of a rate hike next year.

Analysts at CBA and NAB see a February hike as likely, however Westpac cautions that a rate move remains premature.

Meanwhile, the government’s latest budget update, which projects a slightly smaller 2025/26 deficit on stronger tax receipts, had little impact on the central bank’s policy outlook.

With spending left largely unchanged, investors are betting the Reserve Bank of Australia may need to lift its 3.6% cash rate by June to rein in inflation.

Key inflation data, November’s monthly figures and the December quarterly report, will provide further guidance, with a quarterly trimmed mean increase above 0.8% potentially prompting action at the February 3 meeting.

Elsewhere, the US dollar remained under pressure after soft labor market data clouded the outlook for the Federal Reserve’s next policy moves.



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