Aussie dollar rises as RBA stands pat

The Australian dollar rose to around $0.660 on Tuesday, marking its third straight session of gains as investors digested the Reserve Bank of Australia's latest monetary policy decision.

The central bank held the cash rate at 3.6%, aligning with market expectations and keeping rates at its lowest level since April 2023.

The board noted that both headline and trimmed mean inflation remained within the 2–3% target in Q2, though early signs suggest Q3 inflation could exceed forecasts.

Moreover, the uncertainties surrounding domestic growth and inflation persist, prompting the central bank to maintain a cautious stance.

On the domestic front, the private sector credit growth in August aligned with market expectations but eased slightly compared to the previous month, while total dwelling approvals declined at a slower pace yet defied expectations.

Externally, the Aussie dollar gained additional support from a weaker greenback amid growing concerns over a potential US government shutdown.