The Australian dollar traded steadily on Tuesday after the Reserve Bank of Australia (RBA) released its April meeting minutes, which indicated a continued focus on taming inflation despite signs of a cooling economy. The AUD held near recent highs, reflecting investor confidence that interest rates could remain elevated for longer than previously expected.
According to the minutes, RBA officials discussed the case for keeping the cash rate unchanged at 4.35%, citing persistent inflation risks and a tight labor market. While the board acknowledged uncertainties surrounding household spending and global economic conditions, it emphasized that inflation remained above the central bank’s 2–3% target range and warranted close monitoring.
Traders interpreted the minutes as mildly hawkish, especially given that policymakers did not rule out the possibility of future rate hikes. The language used suggested the central bank remains cautious about declaring victory over inflation, which gave the Aussie dollar a modest boost in the currency markets. As of late afternoon in Sydney, the AUD was trading around 0.6615 against the US dollar, flat from the previous session but near a one-week high.
Global markets have been closely watching central bank rhetoric as major economies, including the U.S. and Europe, consider pausing or cutting rates in the second half of the year. In contrast, the RBA has maintained a relatively data-dependent stance, which could keep Australian yields attractive to investors in the near term.
Looking ahead, analysts expect the RBA to keep rates on hold at its next meeting unless inflation data surprises to the upside. “The tone of the minutes suggests the Bank is still uneasy about inflation dynamics,” said a Sydney-based currency strategist. “That’s likely to keep the Aussie supported, especially if the Fed pivots before the RBA does.”
