Australian Dollar Holds Decline
The Australian dollar held its decline around $0.648 on Tuesday, as investors weighed the latest minutes from the Reserve Bank of Australia. The central bank signaled that additional interest rate cuts are likely over the coming year, with the pace of easing dependent on incoming economic data.
At its August 2025 meeting, the RBA Board lowered the cash rate by 25 bps to 3.6%, citing continued progress in bringing inflation closer to the midpoint of its 2–3% target range. While a gradual pace of easing may be appropriate due to a still-tight labor market, strengthening private demand, and uncertainty around the neutral rate, a faster pace could be warranted if labor conditions weaken more sharply or global risks, like a slowdown or renewed US trade tensions, impact the outlook. Markets now anticipate that the RBA will hold rates steady in September, with the possibility of another cut in November. In the longer term, rates are expected to potentially reach 3.10% or even 2.85%.
Source: Trading Economics
