Australian Dollar Remains Firm

2026-08-04 02:00 By Joshua Ferrer 1 min. read

The Australian dollar traded around $0.70, near multi-week highs as stronger-than-expected household spending reinforced signs of resilient domestic demand ahead of the Reserve Bank’s monetary policy meeting next week.

Household spending rose 0.8% in June, well above forecasts of 0.2%, driven by another increase in discretionary spending, while annual growth accelerated to 6.0%, also exceeding expectations.

The data supported the central bank’s view that consumer activity remains firm despite weak sentiment, although recent softer inflation and a cooling housing market have strengthened expectations that the central bank will leave its 4.35% cash rate unchanged next week.

Markets are also pricing little chance of a rate hike in September, while assigning roughly a 50% probability of a move in November if third-quarter inflation proves stronger than expected.

Investors now await upcoming final PMI figures and trade balance data this week for further clues on the economy’s health.



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