AUD/USD rallies toward July highs after upbeat data – Rabobank

The Australian Dollar (AUD) climbed near July highs as stronger-than-expected GDP and household spending data cast doubt on further RBA rate cuts this year. While analysts forecast a moderate uptrend into 2026, they see room for short-term USD strength to push AUD/USD back toward 0.65 before resuming its rally, Rabobank's FX analyst Jane Foley reports.

Australian Q2 GDP surprises at 0.6% y/y, household spending jumps

"Last week, Australian Q2 GDP data posted a better than expected 0.6% y/y. The buoyant headline was followed by the news that household spending growth in July strengthened to 5.1% y/y. The relative strength of these data has cast some doubt on the ability of the RBA to cut rates again this year, even though CPI inflation has fallen back within the central bank’s 2-3% target band."

"Since these data releases last week, AUD/USD has pushed higher with the currency pair yesterday almost reaching its July high. While we continue to forecast a moderate uptrend in the currency pair into next year, we see scope for short covering in favour of the USD on a 1 to 3 month view."

"We see scope for a move back to the 0.65 area in this timeframe before AUD/USD moves to 0.89 on a 12 month view."