The cautious policy stance of the Reserve Bank of Australia (RBA) is set to cap further AUD gains. However, economists at Rabobank have upgraded their three-month AUD/USD forecast to 0.72 based on higher commodity prices.

RBA not to veer from its dovish position

“Although higher prices for exports such as coal and LNG should continue to provide the aussie with support near-term, barring any change in the RBA’s guidance that rates are likely to be on hold until 2024, we expect the AUD to struggle to maintain recent gains vs. the USD.” 

“While we expect the dovish tone of the RBA to keep the value of AUD/USD in check into next year and beyond, based on the strength of Australian resource and energy exports we have revised up our three-month AUD/USD forecast from 0.71 to 0.72.”