2025.08.2602:39:19UTC+00Australian Dollar Holds Decline

The Australian dollar maintained its decline, hovering around $0.648 on Tuesday, as investors assessed the latest insights from the Reserve Bank of Australia (RBA). The RBA indicated that further interest rate reductions are probable over the next year, with the speed of cuts contingent on forthcoming economic data. During its meeting in August 2025, the RBA Board reduced the cash rate by 25 basis points, bringing it to 3.6%. This decision was based on ongoing strides toward aligning inflation with the central point of its 2–3% target range. While a measured pace of easing may be suitable given the persistently tight labor market, robust private demand, and uncertainty concerning the neutral rate, a more accelerated pace may become necessary if labor market conditions worsen significantly or if global challenges, such as an economic slowdown or renewed US trade tensions, affect the economic outlook. The market currently expects the RBA to maintain steady rates in September, with a possible further reduction in November. In the longer perspective, interest rates could lower to 3.10% or perhaps even 2.85%.