Australian dollar hits three-year high against US dollar as RBA rate hike talk dominates sentiments

The Australian dollar has been rising recently and is consolidating near a three-year high as market eye Reserve Bank of Australia monetary tightening action. AUD/USD climbed to 0.7125 today and currently trades at 0.7119, down marginally on the day. US dollar index is lax in global markets while key commodity prices generally stay elevated. Rising commodities tend to support the AUD given Australias heavy dependence on exports of a number of minerals and metals. Reserve Bank of Australia bank will raise rates again if inflation becomes entrenched, Michele Bullock, the central bank governor said today. The RBA delivered the first rate rise in two years last week. The RBA Deputy Governor Andrew Hauser also delivered a hawkish set of comments yesterday as he highlighted resurgent domestic demand.

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