In tomorrow’s early Asian session, Aussie traders will fixate upon the Reserve Bank of Australia’s rate decision for their November meeting to gauge the direction of the Australian Dollar but also the Australian equity market, in the foreseeable future.

Money markets project with a 95% certainty that RBA policymakers will go for a pause at the upcoming decision, keeping the overnight borrowing rate at 3.6%, after three cuts earlier this year, extrapolating that the recent flare up of inflation, invalidates the scenario for further policy easing. Not only that, but expectations for the prolongment of the pause are spread wide and high until the meeting of March of 2026, where forecasters are somewhat divided for a cut or another pause.

The latest quarterly CPI update showcased the jump of inflationary pressures from the prior quarter’s 2.1% reading to 3.2%, exiting marginally the bank’s 1-3% target range and reignited concerns.

Furthermore, the continuation of the cooling of the labour market adds more credibility in the camp that projects the implementation of the “wait and see”, as policymakers won’t risk the deterioration of employment conditions by extra easing measures.

Equity markets have notched down from record highs, easing to 1-month lows with healthcare stocks malfunctioning, but placing a floor under the ASX index is the performance of the banking sector. Miners are also performing decently, supported by the President Trump’s announcement that Washington is considering casting bids towards them to safeguard the supply of critical minerals and metals for the AI race.

Lastly the Aussie is gyrating around the $0.65 area against the greenback, holding much strongly than expected compared to its peers in the Easter Asian region, like the Japanese Yen, the New Zealand Dollar and the Taiwanese Dollar and the fact that the RBA will most likely hold its horses for the entirety of this quarter (possibly the next as well) creates favourable conditions, purely on the net interest differential discrepancy expectations.

Technical Analysis

AUDUSD Chart – The Australian dollar gyrates near the $0.65 area against the greenback ahead of RBA policy meeting

Resistance: 0.6630 (R1), 0.6700 (R2), 0.6800 (R3)
Support: 0.6520 (S1), 0.6440 (S2), 0.6370 (S3)