Aussie rallied sharply after the hawkish rate hike from the RBA , but gains cooled as Governor Michele Bullock delivered a measured press conference. The price action reflected a strong initial policy reaction followed by a pause as guidance resisted a straight-line tightening narrative. Even so, Aussie remains the strongest performer on the day. The moderation in momentum should be read as consolidation rather than reversal, with Bullock deliberately avoiding language that would lock the Bank into a clear tightening sequence.
Bullock stressed that the RBA is “not ruling anything in or out” and will remain data dependent. Despite the Bank’s own forecasts implying another hike later this year, she resisted giving a straight answer on whether policy is now in a tightening cycle, saying, “I don’t know if it is in a cycle.”
She emphasized the Board’s cautious approach, noting that policymakers have delivered one rate rise and will now assess how financial conditions respond. Early signs of tightening through the exchange rate are already evident, but the RBA wants to observe impacts on credit and housing before drawing conclusions. Crucially, Bullock preserved optionality. While she stopped short of predicting further hikes, she also made clear that additional tightening remains possible if inflation stays too high, keeping the policy bias conditionally hawkish rather than pre-committed.
Across the crosses, the Aussie’s strength is more pronounced. AUD/CAD broke above the 0.9589 temporary top to resume its uptrend, supported by a rising 55 4H EMA. With prior break of the medium-term rising channel ceiling signaling upside acceleration, the outlook stays firmly bullish. Next target is 200% projection of 0.8902 to 0.9225 from 0.9055 at 0.9701. Decisive break there will target 261.8% projection at 0.9901.
