The meeting on Tuesday is the last meeting for the year and the next meeting is not due until 18 February. AUD was last at 0.6448, OCBC’s FX analysts Frances Cheung and Christopher Wong note.

Risks remain skewed to the downside

“We expect cash rate to remain on hold at 4.35% as services inflation remains sticky and labour market is fairly tight. The risk is an earlier than expected dovish pivot as softer than expected 3Q GDP print last week saw markets shifted expectations to fully price in a cut at Apr’s meeting. There were also light chatters if RBA may even need to cut earlier at the Feb meeting.”

“Tariff worries, slowing growth momentum and anticipation for earlier RBA cuts are some factors that may continue to undermine AUD in the short term, unless AU labour market report on Thu comes in hotter or USD reverses lower.”

“Daily momentum is mild bearish while RSI fell. Risks remain skewed to the downside. Support at 0.6380, 0.6350 (2024 low). Break out risks a sharp move towards 0.6270 (2023 low). Resistance at 0.6485 (21 DMA).”