The RBA may announce a pause in rate hikes, and the tightening cycle is ripe

Calls are growing for the RBA to announce a pause in rate hikes after the official cash rate was raised by 350 basis points. The bank said in March it would reconsider pausing rate hikes. Monthly inflation data showed CPI had already peaked in late 2022, giving the RBA room to pause rate hikes.No matter what happens at Tuesday’s policy meeting, the RBA will not signal that the contraction cycle is over, although the tightening cycle now appears to be very ripe.

AUD/USD struggled to overcome intraday losses as the latest statistics from China and Australia added to a gloomy mood early on Monday amid concerns about a dovish RBA rate hike and weaker U.S. economic activity and employment data.