AUD/USD bearish outlook.

RBA hiked cash rate 25bp to 4.85% on 3 Nov 2026 with 6-3 majority, citing materially higher inflation forecasts now seeing above-3% inflation through much of 2027. Yet AUD/USD fell 0.35% to 0.6984, extending a 5-day decline of 0.69%, with the rate below both its 5-day average (0.7015) and 20-day average (0.6994). This suggests the hike was priced in or broader USD strength dominates. The pair has retreated from recent highs near 0.7033. If RBA tightening weighs on growth and housing without incremental AUD support, further downside toward the 20-day average vicinity is plausible.

What could change the view. A sustained break above the 5-day average at 0.7015 would suggest the post-RBA selloff was a knee-jerk reaction. The RBA noted stronger-than-expected growth in major trading partners; improved global risk appetite could lift AUD independently of domestic rate dynamics.