Date: 29th September 2026.
AUDUSD Falls Despite RBA Hike as Gold Drops to an 7-Week Low.
The Reserve Bank of Australia increases interest rates for the fourth time taking the rate to a 15-year high. However, the Australian Dollar saw a considerable decline after the governor’s speech due to economic concerns. The best performing currencies of the day are the Japanese Yen and US Dollar.
The US Dollar continues to find support from higher bond yields and expectations of further interest rate hikes. The stronger Dollar and higher yields saw a pause in the stock market’s bullish trend, but Gold saw the harshest ripple effect. Gold fell 4.00% in total on Monday taking the price to an 8-week low.
The Reserve Bank of Australia has been particularly hawkish as inflation has remained far above its 2% target. Between 2015 to 2020, Australia’s inflation rate on average was 1.85%. Whereas the average over the past 5 years has been 4.3%. Inflation is the key reason behind the bank’s hawkish stance, however, the economy has also been weakening as a result.
The fourth rate increase is expected to add around $480 per month to repayments on an average $730,000 mortgage compared with January. This equates to more than $5,000 per year.
One of the reasons behind the decline and the market reaction was that the hike was already priced into the market. The second is that economists and the central bank are expecting higher rates to cause an economic slowdown. Economists now advise the possibility of a recession for Australia has risen to 35%.
Higher Australian rates are also becoming a growth risk. This was the RBA's fourth increase this year, and the bank acknowledges that previous tightening is already slowing parts of the economy. That means additional hikes could eventually become negative for the Australian Dollar if investors become more worried about Australian growth.
Lastly, another key factor is the strength of the US Dollar. The stronger Dollar is also placing downward pressure on Gold prices, which could further weigh on AUDUSD given Australia’s close exposure to commodity markets.
HFM - AUDUSD 20-Minute Chart
The decline is due to higher bonds, a strong US Dollar, rate hike expectations and also fear that oil prices will remain around $100. If oil prices remain high and rate hikes expectations continue, Gold prices may fall to the $4,000 psychological price. Another negative indication for Gold is that all metals are currently declining, despite Gold’s small upward retracement.
Traders remain concerned about the lack of progress toward a peaceful settlement in the Middle East. The Wall Street Journal reported that the White House rejected Tehran’s proposal to unblock Iranian assets and ports in exchange for restoring traffic through the Strait of Hormuz. Trump later said talks could continue this week.
The risk of renewed escalation in the Persian Gulf is raising concerns about further disruptions to oil supplies and prolonged inflation. This could increase expectations for tighter Federal Reserve policy, particularly as officials continue to warn about persistent price pressures.
HFM - Gold 20-Minutes
On the 5-minute chart, AUDUSD remains under short-term pressure, with price trading below key moving averages and VWAP. The Bollinger Bands continue to reflect bearish momentum, while RSI remains below 50, indicating sellers still have the upper hand. However, if RSI moves toward oversold territory and price starts recovering above VWAP and the middle Bollinger Band, a short-term rebound could develop.
On the 30-minute and 60-minute charts, the broader technical structure remains bearish. Price is still below the main moving averages, while the Bollinger Bands continue to favour the downside. RSI remains below 50 but has not yet reached deeply oversold levels, suggesting further weakness remains possible. RSI entered oversold territory on Monday but has since recovered above that level. A sustained recovery above VWAP and the short-term moving-average cluster would be needed to signal that bearish momentum is starting to weaken.
Please note that times displayed based on local time zone and are from time of writing this report.
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Michalis Efthymiou
HFMarkets
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
AUDUSD Falls Despite RBA Hike as Gold Drops to an 7-Week Low.
The Reserve Bank of Australia increases interest rates for the fourth time taking the rate to a 15-year high. However, the Australian Dollar saw a considerable decline after the governor’s speech due to economic concerns. The best performing currencies of the day are the Japanese Yen and US Dollar.
The US Dollar continues to find support from higher bond yields and expectations of further interest rate hikes. The stronger Dollar and higher yields saw a pause in the stock market’s bullish trend, but Gold saw the harshest ripple effect. Gold fell 4.00% in total on Monday taking the price to an 8-week low.
AUDUSD - RBA Hikes But Economic Worries Take The AUD Lower
The Australian Dollar Index is currently trading 0.44% lower during this morning Asian session and 0.50% against the US Dollar. The Reserve Bank of Australia increased its interest rate from 4.35% to 4.60% and remains the most hawkish central bank of 2026. This has been one of the primary reasons behind the bullish trend seen this year.The Reserve Bank of Australia has been particularly hawkish as inflation has remained far above its 2% target. Between 2015 to 2020, Australia’s inflation rate on average was 1.85%. Whereas the average over the past 5 years has been 4.3%. Inflation is the key reason behind the bank’s hawkish stance, however, the economy has also been weakening as a result.
The fourth rate increase is expected to add around $480 per month to repayments on an average $730,000 mortgage compared with January. This equates to more than $5,000 per year.
One of the reasons behind the decline and the market reaction was that the hike was already priced into the market. The second is that economists and the central bank are expecting higher rates to cause an economic slowdown. Economists now advise the possibility of a recession for Australia has risen to 35%.
Higher Australian rates are also becoming a growth risk. This was the RBA's fourth increase this year, and the bank acknowledges that previous tightening is already slowing parts of the economy. That means additional hikes could eventually become negative for the Australian Dollar if investors become more worried about Australian growth.
Lastly, another key factor is the strength of the US Dollar. The stronger Dollar is also placing downward pressure on Gold prices, which could further weigh on AUDUSD given Australia’s close exposure to commodity markets.
HFM - AUDUSD 20-Minute Chart
Gold Declines 4% To Seven-Week Low!
Gold is retracing higher on Tuesday after Monday’s strong bearish decline but continues to remain low. The bullish momentum seen on Tuesday is forming a retracement but is also not indicating a stronger increase. The price action continues to remain relatively weak compared to the previous day's volatility.The decline is due to higher bonds, a strong US Dollar, rate hike expectations and also fear that oil prices will remain around $100. If oil prices remain high and rate hikes expectations continue, Gold prices may fall to the $4,000 psychological price. Another negative indication for Gold is that all metals are currently declining, despite Gold’s small upward retracement.
Traders remain concerned about the lack of progress toward a peaceful settlement in the Middle East. The Wall Street Journal reported that the White House rejected Tehran’s proposal to unblock Iranian assets and ports in exchange for restoring traffic through the Strait of Hormuz. Trump later said talks could continue this week.
The risk of renewed escalation in the Persian Gulf is raising concerns about further disruptions to oil supplies and prolonged inflation. This could increase expectations for tighter Federal Reserve policy, particularly as officials continue to warn about persistent price pressures.
Gold (XAU/USD) - Technical Analysis
HFM - Gold 20-Minutes
On the 5-minute chart, AUDUSD remains under short-term pressure, with price trading below key moving averages and VWAP. The Bollinger Bands continue to reflect bearish momentum, while RSI remains below 50, indicating sellers still have the upper hand. However, if RSI moves toward oversold territory and price starts recovering above VWAP and the middle Bollinger Band, a short-term rebound could develop.
On the 30-minute and 60-minute charts, the broader technical structure remains bearish. Price is still below the main moving averages, while the Bollinger Bands continue to favour the downside. RSI remains below 50 but has not yet reached deeply oversold levels, suggesting further weakness remains possible. RSI entered oversold territory on Monday but has since recovered above that level. A sustained recovery above VWAP and the short-term moving-average cluster would be needed to signal that bearish momentum is starting to weaken.
Key Takeaway:
- The RBA raised interest rates to 4.60%, but concerns over economic growth weighed on the Australian Dollar.
- A stronger US Dollar and higher bond yields continue to place pressure on AUDUSD, equities and Gold.
- Gold declined by approximately 4%, reaching an seven-week low as expectations for tighter monetary policy increased.
- AUDUSD remains technically bearish, with price trading below key moving averages and VWAP.
Please note that times displayed based on local time zone and are from time of writing this report.
Click HERE to access the full HFM Economic calendar.
Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!
Click HERE to READ more Market news.
Michalis Efthymiou
HFMarkets
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.