Australian Dollar holds above 0.7000 near monthly high as hawkish RBA counters firmer USD

• Hawkish remarks from RBA officials keep AUD/USD in demand for a fourth day.
• Monday’s robust Chinese Q3 GDP reading provides further backing for the AUD.
• Concerns over oil-led inflation bolster expectations of a Fed rate rise, underpinning the USD and limiting gains.

Above the psychological 0.7000 level, AUD/USD remains steady in Wednesday’s Asian session, trading with an upward bias for a fourth consecutive day. The pair is hovering close to the monthly high reached a day earlier.

Ahead of the policy meeting on 3 November, hawkish messages from Reserve Bank of Australia (RBA) officials continue to sustain expectations of a rate rise and support the Australian Dollar (AUD). Speaking on Monday, RBA Assistant Governor Christopher Kent pointed to reasonable indications that neutral interest rates are rising in Australia and globally. Earlier today, Deputy Governor Andrew Hauser also cautioned that Q3 trimmed-mean inflation could exceed expectations.

Growth of 4.5% year on year in China during July–September, as shown by the upbeat Q3 GDP release, provides another source of support for the Australian currency. Meanwhile, fears of oil-led inflation are reinforcing the prospect of further Federal Reserve (Fed) tightening, allowing the US Dollar (USD) to extend its modest overnight recovery from a near three-week low. With traders currently assigning a probability of over 90% to a Fed rate rise in December, the US currency is finding support and restraining AUD/USD.

Renewed optimism about US-Iran peace talks could, however, discourage traders from taking sizeable bullish positions in the safe-haven US Dollar. According to media reports, Qatar and Pakistan offered the US and Iran a "middle ground" proposal that satisfied both sides’ demands. With attention still centred on developments in the Middle East crisis, caution is therefore warranted before concluding that the USD’s recent corrective retreat from its highest level since April 2025 is over.

AUD/USD trades near its monthly high on the daily chart

AUD/USD Confirms Range Breakout but Faces Resistance

Having confirmed a break above its short-term trading range, AUD/USD is looking to clear the 38.2% Fibonacci retracement resistance at 0.7024. Further advances could nevertheless meet an obstacle at the 200-day Simple Moving Average (SMA), near 0.7048, followed by the midpoint 50.0% retracement at 0.7064. The latter level maintains the bearish near-term bias, suggesting that spot prices could find it difficult to regain the pivot area within the wider corrective structure.

Should the pair weaken, the first support lies at the 23.6% retracement of 0.6974. Beyond that, buyers would be expected to defend the wider range at the structural floor near 0.6893.

(The technical analysis of this story was written with the help of an AI tool. Find out more.)