It is not easy for the Australian exchange rate to rise! Australia will release inflation data for June, and there is only hope of further interest rate hikes if there is an unexpected and obvious upward trend

On July 18, market analyst Gary Howes said that Australia will release inflation data for June next week, and according to the guidance of meeting notes, only an unexpected and obvious upside may convince the Reserve Bank of Australia to raise interest rates again.

On July 18, market analyst Gary Howes said that to boost the Australian dollar, the Australian dollar would need to release unexpectedly strong inflation data next week to stimulate the Reserve Bank of Australia to resume its rate hike cycle.On July 26 (Wednesday) at 09:30 Beijing time, Australia will release the June CPI.

According to the minutes of the Reserve Bank of Australia's July monetary policy meeting, board members' support for the decision to keep interest rates unchanged has increased compared to the previous decision to press the pause button.

The Australian dollar has fallen against most G10 currencies over the past month due to sluggish growth in Asia and the Reserve Bank of Australia's decision to keep interest rates on hold, and these meeting notes will not change that momentum.

If the Reserve Bank of Australia has ended its rate hike cycle, the Australian dollar will find itself at a disadvantage against currencies with higher interest rates, such as the British pound.

The Reserve Bank of Australia held a more detailed discussion on the scenario of keeping interest rates unchanged, raising the possibility of further rate hikes. For example, the Reserve Bank of Australia noted that "the stance of monetary policy is clearly restrictive" and stressed that an inverted yield curve is "consistent with tighter monetary policy settings".

Australia will release inflation data for June next week, and according to the guidance of meeting notes, only a surprise and significant upside is likely to persuade the Reserve Bank of Australia to raise interest rates again.

The next meeting of the Reserve Bank of Australia will be held on August 1, and the overnight index swap shows a 22% chance of raising interest rates by another 25 basis points.

Australian dollar/US dollar daily chart

At 15:27 on July 18, Beijing time, the Australian dollar was trading at 0.6819/21 against the US dollar.