Aussie Dollar Eyes 4th Monthly Gain

2026-02-27 02:41 By Joshua Ferrer 1 min. read

The Australian dollar traded around $0.711 on Friday, moving near more than three-year highs, and headed for its fourth consecutive monthly gain amid mounting bets of a hawkish policy outlook.

The currency is on track to rise about 2% in February and is up more than 6% year-to-date, making it the top-performing G10 unit as resilient domestic conditions bolster expectations for further tightening by the Reserve Bank.

Money markets are assigning roughly an 80% chance of a rate hike in May following an upside surprise in January inflation, with 40 basis points of total tightening this year.

Still, many economists see the cash rate peaking near 4.10%, close to levels reached during the post-pandemic inflation cycle.

Governor Michele Bullock also reiterated that patience remains appropriate with the economy near balance, tempering expectations of an aggressive hiking path.

Investors now look to next week’s final manufacturing PMI and GDP figures for clearer signals on growth momentum.



News Stream
Aussie Dollar Eyes 4th Monthly Gain
The Australian dollar traded around $0.711 on Friday, moving near more than three-year highs, and headed for its fourth consecutive monthly gain amid mounting bets of a hawkish policy outlook. The currency is on track to rise about 2% in February and is up more than 6% year-to-date, making it the top-performing G10 unit as resilient domestic conditions bolster expectations for further tightening by the Reserve Bank. Money markets are assigning roughly an 80% chance of a rate hike in May following an upside surprise in January inflation, with 40 basis points of total tightening this year. Still, many economists see the cash rate peaking near 4.10%, close to levels reached during the post-pandemic inflation cycle. Governor Michele Bullock also reiterated that patience remains appropriate with the economy near balance, tempering expectations of an aggressive hiking path. Investors now look to next week’s final manufacturing PMI and GDP figures for clearer signals on growth momentum.
2026-02-27
Australian Dollar Hovers 3-Year Highs
The Australian dollar traded around $0.710, hovering near its highest level in more than three years amid mounting expectations of another rate hike. Markets are pricing in roughly an 80% probability that the Reserve Bank will lift its 3.85% cash rate in May after January inflation surprised on the upside. Markets also anticipate about 40 basis points of total hikes this year, though many analysts see the terminal rate near 4.10%, around the peak reached during the post-pandemic inflation surge. Meanwhile, a move as soon as March appears less likely, as policymakers will not receive the full first-quarter inflation report until late April. RBA Governor Michele Bullock also reiterated that policy patience is warranted with the economy close to equilibrium, tempering expectations of an aggressive tightening cycle. Attention now turns to the final reading of manufacturing PMI and GDP figures due next week for further clues on the country’s economic momentum.
2026-02-26
Aussie Dollar Gains on Strong Inflation Print
The Australian dollar strengthened to around $0.70 on Wednesday, extending gains from the previous session as hotter-than-expected inflation data fueled expectations of additional interest rate hikes this year. The annual inflation rate stood at 3.8% in January 2026, surpassing market expectations of 3.7%. Meanwhile, the RBA’s trimmed mean CPI, a key measure of underlying inflation, ticked higher to 3.4%, compared to both market forecasts and December’s 3.3%. The latest data followed a recent report showing that unemployment held at a historically low level in January, while wage growth remained elevated. Markets are now expecting the central bank to lift the cash rate again in May, potentially to 4.1%, with around a 60% chance of another increase in November. Nevertheless, the central bank, which earlier this year became the first major developed-market central bank to resume raising interest rates, has maintained a data-dependent stance.
2026-02-25